Insurance Accounting for Auditing and Assurance Services

Question: Discuss about theInsurance Accounting for Auditing and Assurance Services. Answer: The issues that can be noted in the case are of the missing records from the books. As the records are missing, it will be difficult to ascertain the amount of loss. Moreover, the corporate controller has led to misappropriation and has fled to United State, therefore; it is difficult to get back the papers. Yes, the audit work papers must be re-done because without the audit papers it is difficult to prepare the financial statements. The audit work papers must be prepared because it contains the overall audit evidence. Audit working papers help the audit work to give assurance that the audit was perform in accordance with the appropriate relevant accounting standards (Baldwin, 2010). It is difficult to get the audit evidence once again. However, if the paperwork is appropriate then according to the best of skills the papers can be re-done. this will need time, as well as effort. If the work papers are unavailable then it will affect the audit process and can impact the authentic view. To ensure, that the audit remains completed the papers need to be prepared again and the embezzlement needs to be reported that will signify the defects have been observed and proper care regarding the same is done (Cappelleto, 2010). If the embezzlement is not report in the work papers it will mean that the audit is not properly done and the statement does not reflect the true and fair view. Not reporting embezzlement means that the auditor has not considered the issue that is material to the business. This can lead to a potential problem. In the short term, it can create discontentment among the stakeholders while in the long term the notice of this fact can lead to loss of reputation and loosing up of potential parties (Gay Simnet, 2015). The legal consequence of such a happening is that a legal case must be initiated against the corporate controller account who fled to the United States. When there is an embezzlement of funds, it means that a financial fraud has happened. Hence, this fraud attracts a criminal case. Further, an evaluation of the overall organization needs to be done to find out the deficiencies and others who are involved in the case. Moreover, the Audit Manager must be questioned as to why the embezzlement should not be reported. An audit note is a note that the auditor provides when there is a certain problem or missing point. It is done to provide a clarity to the fact that the auditor has seen all the accounts and the deficiencies are noted. Such a note is a cause for concern if there is a grave problem because the stakeholders do not like a company where a problem exists (Elder et. al, 2010). In the case of a problem, the auditor provides a note that the decision is given considering the points and such difficulty exists. However, this makes the stakeholder apprehensive in nature. References Baldwin, S. (2010) Doing a content audit or inventory. Pearson Press. Cappelleto, G. (2010) Challenges Facing Accounting Education in Australia. AFAANZ, Melbourne Elder, J. R, Beasley S. M. and Arens A. A. (2010) Auditing and Assurance Services. Person Education, New Jersey: USA Gay, G. and Simnet, R. (2015) Auditing and Assurance Services. McGraw Hill