Advance Auditing

1. Explain the Securities and Exchange Commission’s rationale to charge Cardillo executives with each of the following violations:

making false representations to outside auditors
failing to maintain accurate financial records
failing to file prompt financial reports with the SEC
violating the insider trading provisions of the federal securities laws

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2. Determine who was in violation or compliance of the AICPA’s Code of Professional Conduct in this case study and analyze the key reasons why they were or were not in compliance. Provide support for the rationale.
3. Analyze the actions taken by Cardillo’s outside auditors and evaluate the level of efficiency of the audit risk management in this case study. Provide support for the rationale.
4. Determine whether or not the five (5) components of internal control were being followed. Support the response with at least two (2) examples.
5. Create an argument for or against whether auditors have a responsibility to assess the judgment of the decisions made by Cardillo’s management. Support the argument.
6. Use at least two (2) quality academic resources in this assignment. Note: Wikipedia and similar type Websites do not qualify as academic resources.

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