Date of Award
Master of Science (MS)
A comparative analysis will be conducted seeking to identify how to obtain sufficient evidence to determine the existence of an asset within an organization during an independent audit. The external auditor is often regarded as the “gatekeeper” of the financial markets which has a fiduciary duty to its clients. (Choy, Fields, & King, 2008) Accounting firms are required by operation of law to act in an ethical manner and have a social responsibility to protect the interest of the public. However, there exists an ongoing issue in the performance of audits by larger firms. In a recent study conducted by the Public Company Accounting Oversight Board, members found that 1 in 3 audits contain deficiencies that should not have been signed off by the firm. (Chasan, 2015) This capstone will research the current standards and practices related to determining the asset existence within an organization. The capstone will look at current cases involving problems and suggest strategies for validating the existence of an asset by an organization.
 Significant audit performance deficiencies are defined by Public Company Accounting Oversight Board as deficiencies that result in the audit firm lacking sufficient evidence to support its audit opinion. The Public Company Accounting Oversight Board inspectors conduct annual inspections to evaluate the overall effectiveness of the firm’s quality control policies and procedures. Annual inspections assist in determining whether deficiencies are present in public company audits including weaknesses in the firm’s business practices.
Lebron, Luis, "A Close Look at Audit Standards and Best Practices How to Validate the Existence of an Asset" (2018). Economic Crime Forensics Capstones. 25.