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Auditing questions answered

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Please answer following question: Assigned questions for A.5 Quest: 1. Explain whether Quest establish an effective system of internal controls over financial reporting related to the presentation a ... nd disclosure of its nonrecurring revenue. 2. Explain why “tone at the top1” has such a significant impact on internal controls over financial reporting and whether Quest established a proper “tone at the top”. Explain why or why not. 3. Explain the auditor’s responsibility for the information disclosed by Quest at the time of the earnings release and the information disclosed in the management’s discussion and analysis section of the 10-K. 4. Identify three specific factors about Quest’s business strategy that would increase entity-level inherent risk. 5. Based on the entity-level inherent risks identified in question 4, describe the impact of the risks on the nature, timing, and extent of the audit procedures and overall audit strategy. 6. Explain whether the different types of revenue (e.g., construction services and communication services) earned by Quest would be subject to significantly different levels of inherent risk. Support your answer. 7. Identify one relevant management assertion related to revenue recognition for IRU sales by Quest and why it is relevant. 8. For the management assertion identified in question 7, describe both a preventative and detective control that would prevent/detect the practice of up-front revenue recognition of IRU’s by Quest. [Show More]

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