SAS 99 requires auditors to identify risks that need further examination in order to determine the full extent of a possible fraud.
(a) Name three of these risks and give examples of each.
(b) If after conducting a thorough audit, the auditor believes there is a likelihood of misstatements that could be material to a company's financial statements, what should the auditor do? Name the four items.
Arthur Levitt stated that the SEC was seeing five accounting "gimmicks" of "accounting hocus-pocus" that were proving problematic. Name three of these gimmicks and explain in detail.