Audit Final

Front 1

Breach of Contract

Back 1

a claim that accounting or auditing services were not performed in the manner described in the contract

Front 2

Common Law

Back 2

the liability for injuries that is based on reasons other than violation oif a rwritten law or statute. Under common law, legal precedent is used in assessing the degree of responsibility or fault of the parties; auditors have common law liability to clients and non-shareholder third parties

Front 3

Constructive Fraud

Back 3

a failure to provide any vare in fulfilling a duty owed to another including a reckless disregard for the truth (similar to gross negligence)

Front 4

Contributory Negligence

Back 4

a legal defense theory in which the plaintiff’s own failure to perform with the appropriate level of professional care bars recovery from auditors

Front 5

Financial Reporting Releases

Back 5

reports prepared by SEC staff that express new rules and policies of that work by the general public

Front 6

Foreseeable Party

Back 6

the individuals or organizations whose decisions normally rely on audited financial statements and opinions

Front 7

Form 8-K

Back 7

The “current events” report filed periodically at the occurrence of major events, such as earnings releases, major asset sales, acquisitions, and auditor changes

Front 8

Form 10-K

Back 8

annual filing of financial statements and related disclosures by public companies with the SEC

Front 9

Form 10-Q

Back 9

quarterly filing of financial statements and related disclosures by public companies with the SEC

Front 10

Initial Public Offering (IPO):

Back 10

The initial issuance of securities by a registrant entity to the investing public through a market that is subject to the provisions of the securities act of 1933

Front 11

Joint and Several Liability

Back 11

the legal doctrine that when multiple defendants are named, the full amount of a damage award may be collected from any of the defendants named in the lawsuit even though they may be only partially at fault

Front 12

Ordinary Negligence:

Back 12

the unintentional breaches of duty owed to another as a result of a lack of reasonable care

Front 13

Plaintiff

Back 13

the person or organization that initiates a lawsuit (client or third-party user of financial statements)

Front 14

Primary Beneficiary

Back 14

a person known by name to the auditor for whose primary benefit the audit or other accounting services is performed

Front 15

Privity of Contract

Back 15

a situation in which parties have a contractual relationship

Front 16

Proportionate Liability

Back 16

the legal doctrine that payment of a share of the court’s damage award be based on the extent (or proportion) of fault exhibited by a convicted defendant

Front 17

Prospectus

Back 17

a legal document offering securities for sale and includes significant information about the issuing entity, including its historical financial statements and other necessary disclosures

Front 18

Registration Statement

Back 18

a set of documents, including a prospectus, that a company files with the SEC prior to an initial public offering

Front 19

Statutory Law

Back 19

the legal rules affecting liability based on violations of written law or statutes. Auditors have statutory liability to third party investors under the securities acts

Front 20

Tort

Back 20

a civil complaint charging that the action of one person caused injury (personal or financial) to another; such action against auditors is normally initiated by users of financial statements

Front 21

Computer Operators

Back 21

the workers who actually put the data into the computers

Front 22

Systems Analysis

Back 22

More accountant than computer science. comes from the unit that needs the program. figures out how and when things are done, and actually knows what is needed

Front 23

Programmer

Back 23

writes the program for the various departments. Does not have access to change the files however

Front 24

Responsibilities

Back 24

Exercise sensitive professional and moral judgment

Front 25

Public Interest

Back 25

honor the public trust

Front 26

Integrity

Back 26

perform responsibilities with the highest sense of integrity

Front 27

objectivity

Back 27

impartial, unbiased, and independent, free of conflicts of interest and independent in fact and appearance

Front 28

due care

Back 28

diligence, competence, thorough, prompt

Front 29

scope and nature of services

Back 29

observe the principles when considering the scope and nature of services provided

Front 30

AICPA Rules

Back 30

Responsibilities, public interest, integrity, objectivity, due care, scope and nature of services

Front 31

COBIT Framework

Back 31

Plan and Organize
Acquire and Implement
Deliver and Support
Monitor and Evaluate

Front 32

Plan and Organize

Back 32

define strategic IT plan, information direction, processes, organization, and relationship

manage IT investment, human resources, and quality

Front 33

Acquire and Implement

Back 33

Identify automated solutions

Acquire and maintain application software and technology infrastructure

Enable operations use, procure IT resources

Front 34

Deliver and Support

Back 34

Define and manage service levels

Manage 3rd party, performance and capacity, service desk, configuration, problems, data, physical environment and operations

Ensure continuous service and systems security

Identify and Allocate costs

Front 35

Occurrence

Back 35

The event actually happened

Front 36

Completeness

Back 36

all purchases and related events that should have been recorded have been recorded

Front 37

accuracy

Back 37

amounts and other data related transactions and events have been recorded properly

Front 38

Cutoff

Back 38

purchases and related events have been recorded in the correct period

Front 39

Classification

Back 39

purchases and related events have been recorded in the proper accounts

Front 40

Management Assertions

Back 40

Occurrence, Accuracy, Completeness, Cutoff, Classification