03
Feb
10

A.01 Internet Problem (Worksheet 1)

Shelly Huzaynah 21207019

SMAK01-7

Auditing 2

Question :

  1. According to Section 404 of SOX a public company’s annual report must include an internal control report. What are the two required elements of management’s report on internal control?
  2. What obligation does a public company’s auditor have with respect to internal control over financial reporting according to Section 404?

Answer :

  1. – State the responsibility of management for establishing and maintaining an adequate internal control structure and procedures for financial reporting.

– Contain an assessment, as of the end of the most recent fiscal year of the issuer, of the effectiveness of the internal control structure and procedures of the issuer for financial reporting.

2.  Each registered public accounting firm that prepares or issues the audit report for the issuer shall attest to, and report on, the assessment made by the management of the issuer. An attestation made under this subsection shall be made in accordance with standards for attestation engagements issued or adopted by the Board. Any such attestation shall not be the subject of a separate engagement.

Source : [http://www.pcaobus.org/About_the_PCAOB/Sarbanes_Oxley_Act_of_2002.pdf]


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