According to AU-C 200 & AU-C230, GASS requires that the auditor should obtain a reasonable assurance “Not absolute assurance” about whether the financial statements are free from material misstatement. To reach that the auditor needs to collect evidences that have reasonable quantity and quality “sufficient appropriate audit evidence”. In AU-C 230, the objective of the auditor is to plan and perform the audit work in order to obtain sufficient appropriate audit evidence to reduce the audit risk. Therefore, based on GASS, the audit opinion on the report can’t be absolute assurance and this match with Ms. Stitt’s testimony about the concept of reasonable assurance. Also, I believe that Ms. Stitt’s has clarified the auditor responsibility to obtain a reasonable assurance as described in AU-C
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Also, ASC 850 notes that related party transactions should disclose with specific details such as nature of the relationship, description of the transaction, amounts, and due date. One of the terms that can be defending as related parties based on FASB is entity’s management. Black and Radler serviced as (CEO) and (COO) at Hollinger International. Therefore, because their position in the company, we can say that the non- compete payment in the case describe as “related party transaction”. Unusual transactions, related party transactions, and transactions with its executive officers are the three critical areas in the new standard according to AS 18. The new standard addressed those areas in order to reduce the risks of material misstatement of the financial statements. According to AS 18, the primary auditor responsibilities are to determine whether related party’s transactions and relationships have been properly identified, accounted, and disclosed in the financial statements. The communication guidance between the auditor and audit committee resides in AU-C 260 and AS
Also, ASC 850 notes that related party transactions should disclose with specific details such as nature of the relationship, description of the transaction, amounts, and due date. One of the terms that can be defending as related parties based on FASB is entity’s management. Black and Radler serviced as (CEO) and (COO) at Hollinger International. Therefore, because their position in the company, we can say that the non- compete payment in the case describe as “related party transaction”. Unusual transactions, related party transactions, and transactions with its executive officers are the three critical areas in the new standard according to AS 18. The new standard addressed those areas in order to reduce the risks of material misstatement of the financial statements. According to AS 18, the primary auditor responsibilities are to determine whether related party’s transactions and relationships have been properly identified, accounted, and disclosed in the financial statements. The communication guidance between the auditor and audit committee resides in AU-C 260 and AS