TheCPAProfession.pptVIP

The CPA Profession Chapter 2 Learning Objective 1 Describe the nature of CPA firms, what they do, and their structure. Certified Public Accounting Firms Certified Public Accounting Firms Certified Public Accounting Firms Activities of CPA Firms Structure of CPA Firms Organizational Structure Hierarchy of a Typical CPA Firm Hierarchy of a TypicalCPA Firm E-Commerce andCPA Firm Operations Learning Objective 2 Understand the role of the Public Company Accounting Oversight Board and the effects of the Sarbanes-Oxley Act on the CPA profession. The collapses of Enron, Anderson, WorldCom and the Congress’ response-- Sarbanes-Oxley Act of 2002 Sarbanes-Oxley Act 1. Improved corporate governance Corporate Governance is a process by which the owners and creditors of an organization exert control and require accountability for the resources entrusted to the organization. The owners (stockholders) elect a board of directors to provide oversight of the organization‘s activities”。 公司的所有者和债权人用来控制和要求经营管理者对受托的经济资源履行相关责任时进行的一系列制度安排。 The lack of corporate governance was a major factor in business failures; most notably, a failure of Boards of Directors to oversee management, and effectively utilize the audit function. Sarbanes requires Boards of Directors be independent of the organization and exercise oversight over management and the audit function Further, the Board of Directors, through its audit committee, is the client of the public accounting firm. What is the enhanced role of audit committees under Sarbanes? Is designated as the audit client Has oversight responsibilities over the internal audit and financial reporting processes Must be comprised of outside directors, i.e. not members of management or have other relationships with the organization Must report on its activities, including the results of significant discussions with the external auditor Audit committee responsibilities include Be appraised of all significant accounting decisions ma