Auditing Seminar & Cases
BUSINESS ASSURANCE
ACC 8033
Summer 2016-2th Term
Section 51
Instructor: John T. Rigsby Office Hours: 9:00-9:45 pm (M-Th)
Office: 300T McCool Hall Class Room: 100 AGENG
Office Phone: 325-1640 Class Hours: Sec. 51: 10:00-11:50 am (M-F)
E-Mail:
Required Texts: 1. Practitioner’s Guide to GAAS, 2016, Wiley
2. Bisk CPA Review—Auditing & Attestation, Bisk, 2016. 45th Ed, Thomson
Reuters
Optional Texts: 3. Comtemporary Auditing: Real Issues and Cases, Michel Knapp, West
Publishing Co.
Recommended A recent auditing textbook is also useful for certain parts of the course,
Texts: e.g., ethics, legal liabilities, and audit report modifications and special
reports. A copy of a recent textbook will be made available in the reserve
room of the library if you don’t have one.
Course This course is designed to be an in-depth study of the auditor’s
Objectives: professional responsibilities, ethics, audit reporting, and other current
topics in the practice of auditing. Its purpose is to expose you to current
issues and developments in the auditing profession and in the process enhance your understanding of the technical, ethical, social, and political issues with which you will be dealing and also develop oral and written communication skills. Over the course of the term we will have an outside speaker dealing with external auditing.
Students should develop and exhibit a working knowledge of the professional auditing standards, which will be applied in several cases. The cases, class room discussions, and oral and written exercises are used to allow you to develop your professional judgment, critical thinking, and communication skills. Areas that we spend additional time on are ethics, internal controls, statistics, analytical review, effects of globalization and diversity on accounting, and audit reports. In addition, current events affecting the auditing profession are emphasized in understanding the social and economic role that audits play and the significant pressures and expectations that are placed on auditors, both within the larger society by users, regulators and others, and within the CPA firm.
Course 1. The level of difficulty and rigor of the course material covered in
Requirements: class will require you to be present. There is a direct correlation between
class attendance and performance on exams. You are preparing for a
professional career; therefore, you should view this class as a professional job assignment. Attendance is expected, especially as fast as the summer term goes!
2. A key ingredient for success is self-study. Classroom lectures and activities are designed to guide you and direct your learning experience. Much of your learning occurs outside the classroom; therefore it is your responsibility to diligently study the assigned course materials. Considerable effort on your part is required and is a long-term investment in yourself.
3. You need to apply concepts, not just memorize them, as this course is aimed at developing and internalizing a model for making audit judgments.
4. You are encouraged to work with others in your study group to go over the course material, as auditing is a process of developing judgment. The more you can verbalize the concepts, the better prepared you are for concept application. It is important to develop the professional habit of both developing your own mind and listening to and learning from those around you. You should value the views and perceptions of others and also remember that you have the right and freedom to challenge their thinking as well. Everyone should be dealt with in a professional manner.
Assumptions: I am operating on the assumption that you want to gain the most you can
from your studies and will therefore invest yourself in readings and
assignments and come to every class prepared to engage fully. Therefore, learning is student-centered, active, integrated, cumulative, and connected. I assume you will take responsibility for your own learning and will also contribute to the learning of others. What you gain from this experience is in direct correlation to what you invest in it. You may assume that I care about your success—personally, academically, and professionally. I trust you will work to balance effectively your personal, academic, and professional commitments. I want you to gain the most possible from this experience and I am committed to my facilitator role in this venture. I want to hear your experiences, ideas, and feedback; and will hold you accountable to high academic standards.
Grades: Grades will be assigned on the following basis:
Activity Maximum Points
Knapp Case Write-ups (7)…...... 49
Current Topic Write-ups (2)………………….… 6
Quizzes (3)………………………………………. 45
Debate ….………….…………………………… 20
Journal (1)..…….……………………………… 5
Paper…………………………………………….. 25
Participation……………………………………… 20
Test 1……………………………..……………. 100
Test 2…………………………………………. 100
Final...... 150
TOTAL...... 520 pts.
The 90-80-70-60 grade scale will be used.
Knapp Case Each student will be assigned to a team which is responsible for a typed write-up
Write-ups: of the questions to the seven Knapp cases assigned. The case write-ups are to be turned in to me on the day the case is presented. Points will be deducted for each
day the case write-up is late. All team members will receive the same grade, which will be based upon
whether (1)the answers address the questions asked and (2) the clearness and correctness with which ideas
are presented.
Current Topic Each student is to prepare two one-page summaries of current events occurring in the auditing profession or the business world. The one-page
summaries are to be typed, single space, with a single blank line between paragraphs. They may discuss multiple events or a single event. Your name, the course title, and current event 1 or 2 is to be indicated on the back of the page, which is to be folded when turn in. Due dates are indicted in assignments.
Quizzes Three quizzes will be given over the course of the summer. One is on ethics, one is on Statements on Auditing Standards, and one is on Audit Sampling.
Debates: Teams of two are to sign up from a list of topics for a short Power Point presentation
of seven to ten minutes on one or another side of matters of current interest in the auditing profession., e.g., whether audit firms should be required to rotate off from their clients periodically or if SARBOX goes too far. Its purpose is to expose you to several areas of controversy and continuing change in auditing and the elements that make up a persuasive argument. The presentations will be made at the beginning of class; a pro and a con will be presented. You are to dress well when you give your presenta-ion but it does not have to be professionally, e.g., khakis and polo shirt is ok, shorts or tank top is not.
Journal: You are to turn in a journal write-up on Tuesday of the first full week, July 12.
Its purpose is for me to get to know you. It is to be one page, typed and may be e-
mailed in if that is more convenient.
Paper: Each student will be assigned to a team that is to prepare and turn in a ten to twelve page (excluding title page and reference page), double-spaced, typed (12 type) paper on some aspect of the development of the auditing profession
incorporating the two Zeff articles that we covered in class and a number of other articles. Length does
matter as well as the quality of the development. Do use spell and grammar check. All sources are to be
properly referenced using the sample format provided. Possible points will be allocated between the
development of the topic, length, references, and grammar. The due date is July 29. The paper should have
an introduction, development and a conclusion.
Participation Participation and attendance in class is critical to your success in this class.
Exams/ The exams consists of a combination of multiple-choice questions, short answer,
Final: true-false, and essays/exercises. The final is comprehensive, with the material
covered by the multiple choice questions equally weighted across the course, while the short answer, true-false, and exercises will be on material covered since the last test.
ADA Statement: If you need academic accommodations based on a disability, contact the
office of Student Support Services in Room 01, Montgomery Hall (325-
3335) or email Julie Betty at
Title IX: MSU is committed to complying with Title IX, a federal law that prohibits
discrimination, including violence and harassment, based on sex. This means that MSU’s educational programs and activities must be free from sex discrimination, sexual harassment, and other forms of sexual misconduct. If you or someone you know has experienced sex discrimination, sexual violence and/or harassment by any member of the University community, you are encouraged to report the conduct to MSU’s Director of Title IX/EEO Programs at 325-8124 or by e-mail to . Additional resources are available at http://www.msstate.edu/web/security, or at http://students.msstate.edu/sexualmisconduct/.
Academic Accounting is a profession, the basis of which is our character and
Integrity: integrity. Since you are training to be professionals, you are expected to act
as such. Also all MSU students are to abide by the honor code of the University:
“As a Mississippi State University student I will conduct myself with honor and integrity at all times. I will not lie, cheat, or steal, nor will I accept the actions of those who do.” All occurrences of academic misconduct will be handled in accordance with the Academic Misconduct Policy (www.msstate.edu/web/security.html).
Cellular Phones: To avoid class disruptions, cellular phones and pagers must be placed in the mute
or off mode during class. Cellular phones and pages must be turned off during
all examinations and are not to be used. If I see a cell phone during a test then the
exam will be confiscated and you will get zero points.
Important Dates: July 6 – Last day for dropping/adding a course without a grade.
July 22 – Last day to drop a course with a “W”.
Date Assignments Other
July 5 (T) Introduction
Code of Professional Conduct
ET 101, 102, 201, 203, 301, 302
Sarbanes-Oxley Act
6 (W) Leigh Ann Walker
Statutory-Common Law Legal Liabilities
COSO – Enterprise Risk Management
Code of Professional Conduct
ET 501, 502, 503, 505
7 (Th) “How the U.S. Accounting Profession Got Current topic write-up
Where It Is Today: Part I” –S. Zeff
Subsequent Events
AU 560, 570, 580, 585
Cases 13, 14
8 (F) “How the U.S. Accounting Profession Got
Where It Is Today: Part II” –S. Zeff
Group Financial Statements
AU 600, 610, 620
Case 15, 16
11 (M) Fred Stern & Company, Inc.
Reporting on Financial Statements
AU 700, 705, 706
Case 17
12 (T) Consistency of Financial Statements Journal #1 due
AU 708, 720, 725, 730, Ethics quiz
Cases 18
13 (W) First Securities Company of Chicago
Special Purpose Frameworks
AU 800, 805, 806, 810, 905, 910
Cases 19, 20
14 (Th) Debate #1: SAS quiz Sarah Dorsey & Keelyn Frey
Kolten Maynard & Ryan Smith
Does Sarbanes Oxley Act go too far?
Reporting on Application
AU 915, 920, 925, 930, 935
Cases 21, 22, 23
15 (F) Shari’a Current topic write-up
Debate #2:
Matt Hester & Lucas Fairley
Dustin Ferguson & Alex Herrin
Should Congress reduce auditors’ legal liabilities further?
AU 200 , 210, 220, 230, 240
Cases 1, 2, 3
18 (M) Test I (ETs, AU 560-930)
19 (T) Audit Sampling
AU 530
Speaker: Keith Winfield, Watkins, Ward & Stafford
20 (W) Kansayaku
Debate #3:
Hughes Koury & Ashley Briscoe
Wesley Hulett & Huiwon Yang
Should government agency perform audits of public companies? Audit Sampling
AU530
21 (Th) Debate #4:
Allison Powell & Tori Braswell
Tiana Grover & Kathryn Brazil
Should consulting be completely severed from auditing? Laws and Regulations
AU 250, 260, 265, 300, 315, 320
Cases 4, 5, 6, 33, 34, 37, 38, 45
22 (F) Zuan Yan Stat sampling quiz
Response to Assessed Risk
AU 330, 402, 450, 500. 501
Cases 7, 8, 9, 40, 41, 44
25 (M) Debate #5:
Lee Mosely & Trent Mosely
Grace McKellip & Russell Goodman
Can auditors be independent of their clients?
External Confirmations
AU 505, 510, 520, 540, 550
Cases 10, 11, 12
26 (T) Test 2 (AU 200-501)
27 (W) Debate #6:
Michelle Lewis & Katie Lewis
Caitlin Cruthird & Vivian Buie
Should firms be required to rotate their clients every few years?
COSO – Enterprise Risk Management
Attestation Standards
AT 20, 50, 101, 201, 301, 401
Case 24, 25
28 (Th) Registered Auditors, South Africa
Debate #7:
Chris Hoop & Mathew Marchand
Wesley Reed & Mark Adams
Should US public companies be able to use IFRS or GAAP?
COSO – Enterprise Risk Management
Attestation Standards AT 501, 601, 701, 801, AR 60-90
Cases 26, 27
29 (F) Debate #8 Paper
Laikyn Starkey & Corrine Jackson
Avery Webb & Jamie Koon
Should IFRSs be adopted by US as accounting standard?
COSO – Enterprise Risk Management
Compilations and Reviews
AR 200, 300, 400, 600
Cases 28, 29
August 1 (M) Debate #9 & 10
Cody Turner & Thomas Baxter
Blake Townsend & Michael Luley
Jack McGee
Should the US adopt conceptual approach to independence?
Catch-up and Review
4 (Th) Final Exam (8-11 am)
Note: Assignments are subject to change.