Case 3.1 A day in the life of Brent Dorsey:
Staff auditor Professional Pressures
What alternatives are available to Brent in regards to the audit of Payables?
What are the pros and cons of each alternative?
According the case, Brent had several alternatives suggestions from his co-workers. One of them suggested that in the past years the audit of the payables had not been wrong and that they only had to pulled a few invoices, maybe this year they may be able to pull less invoices and that should help them meet the 35 hour requirement. In order to complete the audit in the budget Meagan suggested that they change the audit plan.
Scott suggested that they put as many hours that they need in order to finish the audit correctly and when they turn it in they would report the budgeted hours that were assigned.
Some cons on the alternative that Megan gave Brent show that they will not meet the 35 hours, because in the past years it has taken them up to 50 hours or even more. Also the fact that she assumes that all the work will be correct and that they could skip a few steps in the process of checking the accounts payable. Scott’s suggestion shows that they would be lying about the hours that they put into the audit.
Some pros to Megan’s alternative are that the firm’s payable for the past years has not had any problems, that maybe this year they will only have to pull a few invoices and that they need to change the auditing plan. Scott’s suggestion allows them to complete the audit with more precision.
What consequences for Brent, the auditing firm, and others involved, may arise form “eating time”, as Scott suggested? Similarly, what consequences for Brent, the auditing firm, and others involved, may arise from not completing audit procedures, as Megan suggested?
Some of the consequences that can rise from not reporting “eating time” hours, are that the firm is not reporting all the hours that were actually worked on the audit, this will lead to...