Assignment 1: Auditors and Regulatory Oversight

The Securities
and Exchange Commission (SEC) regulates public companies. The SEC has found that
some of these companies have violated GAAP by using creative
accounting
practices to mislead investors and creditors regarding the health of their company.

Use the Internet
or Strayer Library to research a recent accounting scandal within the last five
(5) years where the SEC accused public companies of accounting irregularities.

Write
a three to four (3-4) page paper in which you:

1. Analyze the audit
   report that the CPA firm issued. Ascertain the legal liability to third
   parties who relied on financial statements under both common and federal
   securities laws. Justify your response.
2. Speculate on which
   statement of generally acceptable auditing standards (GAAS) that the
   company violated in performing the audit.
3. Compare the
   responsibility of both management and the auditor for financial reporting,
   and give your opinion as to which party should have the greater burden.
   Defend your position.  
4. Analyze the
   sanctions available under SOX, and recommend the key action(s) that the
   PCAOB should take in order to hold management or the audit firm
   accountable for the accounting irregularities. Provide a rationale for
   your response.
5. Use at least two (2)
   quality academic resources in this assignment. Note: Wikipedia and other Websites do not qualify as academic
   resources.

Your
assignment must follow these formatting requirements:

• Be typed, double spaced,
  using Times New Roman font (size 12), with one-inch margins on all sides; citations
  and references must follow APA or school-specific format. Check with your
  professor for any additional instructions.