Professional Skepticism
Professional Skepticism
SUMMARY OF THE FACT
Will recently decides to change careers from a plumber to become a CPA. After successfully completing the CPA Exam he has been working with a regional audit firm, DB&H. His latest assignment, also his first engagement on his own, is an audit engagement of a small town called Rosedale. He is somewhat concerned about completing the audit on his but a little reassured because he has a reliable mentor, Vince Huston, who also works at his firm and on three prior audit assignments together. Vince is willing to provide help and advice to Will and for the most part believe Will is ready to handle audits on his own. Out on his first assignment, Will discovered and informed Vince that his contact with the Town of Rosedale is Jessica Randle the assistant clerk. Jessica happens to be the wife of Wills best friend, Nacho. Vince has advised Will that this is not a problem; in fact he has told Will that this should help him be more comfortable with his engagement. Vince has told Will that his main concern with the engagement is not any violation of independence but rather time management than objectivity. He advised Will that the firm has audited the town for the last four years without any problems and that although controls could be tighter, he should remember that the client has limited resources and therefore will not be perfect.

ISSUES
As part of the audit program Will has to conduct some routine tracing of revenue. He has learned from his previous audits with the company that there is a pattern of a few transactions that require further investigation but that the appropriate documents always turn up and there are no real issues. He arrives at a conclusion of the audit procedure to select. Will decided to select at random, a sample of 20 traffic tickets marked as paid per the receipt book for misdemeanor traffic violations. Trace them back to the sheriffs computerized records as being paid, to bank deposit slips, and to bank statements. As he traces the tickets he finds one marked as paid in cash in the payment records with no corresponding deposit or bank statement record. Will brushes it aside with the assumption that this is likely another instance of an innocent mistake as encountered previously. Instead of wasting any time investigating the missing cash he takes the issue to his best friend’s wife Jessica to ask for an explanation. She explains that the deposit was prepared but fell between two cabinets overnight and was discovered the next morning. To Will this explanation made sense because there were not many cash payments made and it would be easy for the other clerk to have overlooked it. Jessica gave Will the deposit envelope and cash so he could match it with the sheriffs record book. The money was all there and the entry in the

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Vince Huston And Regional Audit Firm. (June 23, 2021). Retrieved from https://www.freeessays.education/vince-huston-and-regional-audit-firm-essay/