BUSINESS ASSURANCE
ACC 8033
Spring 2011
Professor: John T. Rigsby
Office: 300T McCool Hall
E-Mail: jrigsby@cobilan.msstate.edu
Course Meeting Schedule: 12:30-1:45 pm MW
Office Hours: 10:00-11:00 am MW
Phone: 325-1640
Room: McCool 211
Required Materials: 1. Practitioner’s Guide to GAAS-2011, Wiley.
2. CPA Ready—Auditing & Attestation, 2011, Bisk
Optional Texts:
3. Contemporary Auditing: Real Issues and Cases, Michel Knapp, West
Publishing Co.
Recommended
A recent auditing textbook is also useful for certain parts of the course,
e.g., ethics, audit report modifications and special reports. A copy of a recent
textbook will be made available in the reserve room of the library if you don’t
have one.
Texts:
Course
Objectives:
This course is designed to be an in-depth study of the auditor’s professional
responsibilities, ethics, audit reporting, and other current topics in the practice of
auditing. Its purpose is to expose you to current issues and developments
in the auditing profession and in the process enhance your understanding of the technical, ethical, social,
and political issues with which you will be dealing and also develop oral and written communication
skills.
Students should develop and exhibit a working knowledge of the professional
auditing standards, which will be applied in several cases. The cases, class room discussions, and oral and
written exercises are used to allow you to develop your professional judgment, critical thinking, and
communication skills. Areas that we spend additional time on are ethics, internal controls, statistics,
analytical review, and audit reports. In addition, current events affecting the auditing profession are
emphasized in understanding the social and economic role that audits play and the significant pressures
and expectations that are placed on auditors, both within the larger society by users, regulators and others,
and within the CPA firm. Also in completing a number of the cases you will be using the AICPA
database in accessing the professional literature to research particular aspects of the cases.
Course
Requirements:
1. The level of difficulty and rigor of the course material covered in
class will require you to be present. There is a direct correlation between class
attendance and performance on exams. You are preparing for a professional
career; therefore, you should view this class as a professional job assignment. Attendance is expected.
2. A key ingredient for success is self-study. Classroom lectures and activities are
designed to guide you and direct your learning experience. Much of your learning occurs outside the
classroom; therefore it is your responsibility to diligently study the assigned course materials.
Considerable effort on your part is required and is a long-term investment in yourself.
3. You need to apply concepts, not just memorize them, as this course is aimed
at developing and internalizing a model for making audit judgments.
4. You are encouraged to work with others in your study group to go over the
course material, as auditing is a process of developing judgment. The more you can verbalize the
concepts, the better prepared you are for concept application. It is important to develop the professional
habit of both developing your own mind and listening to and learning from those around you. You should
value the views and perceptions of others and also remember that you have the right and freedom to
challenge their thinking as well. Everyone should be dealt with in a professional manner.
Assumptions:
I am operating on the assumption that you want to gain the most you can
from your studies and will therefore invest yourself in readings and
assignments and come to every class prepared to engage fully. Therefore, learning is student-centered,
active, integrated, cumulative, and connected. I assume you will take responsibility for your own learning
and will also contribute to the learning of others. What you gain from this experience is in direct
correlation to what you invest in it.
You may assume that I care about your success—personally, academically, and
professionally. I trust you will work to balance effectively your personal, academic, and professional
commitments. I want you to gain the most possible from this experience and I am committed to my
facilitator role in this venture. I want to hear your experiences, ideas, and feedback; and will hold you
accountable to high academic standards.
Grades:
Grades will be assigned on the following basis:
Activity
Maximum Points
Knapp Case Write-ups (5)....................................
30
Knapp Case Participation (5)……………………. 20
SAS Case Write-ups (2)…………………………. 10
Participation………………………………….….. 35
Current Topic Write-ups (2)……………………
6
Current Topic Presentation (1)..…………………
5
Quizzes (4)………..…….………………………. 60
Debate (1)……………………………………… . 15
Journals(3)………………………………………
9
Paper…………………………………………….. 25
Midterm…..…………………………………… 150
Final...................................................................... 200
TOTAL................................................................. 565 pts.
The 90-80-70-60 grade scale will be used.
Knapp Case
Write-ups:
Each student will be assigned to a team which is responsible for a typed write-up
of the five Knapp cases assigned, which are due on the day the cases are to be
presented. Points will be deducted for each day the case write-up is late. All team
members will receive the same grade, which will be based upon whether (1) the answers address the
questions asked and (2) the clearness and correctness with which ideas are presented. One of the questions
in the regular cases will require the AICPA standards database be accessed and the solution printed out.
The database is available to you in the Seale Computer lab and we will go over how to use it the first week
or so of class.
Knapp Case
Participation:
You are responsible to be prepared to participate when the Knapp cases
are discussed in class. I normally call on several people to get their responses to
each question. Your grade will reflect the level of your participation.
SAS Case
Write-ups:
I have found in covering the auditing standards that it is very useful for you to
have specific questions in reading the SASs and preparing for class discussion.
These SAS cases are shown on the syllabus as Case 1, 2, ect after the specific SAS
section that they are related to, e.g., AU 312. The SAS cases are posted on my website. You should
recognize because of class time pressure that I cannot go into every SAS in great detail, though I would
love to do so. You are responsible to spend a little time with each one and much more on those that I tell
you are more important.
Participation
This score depends upon attendance and participation in class.
I also will periodically ask you to access the AICPA data base for some of the SAS questions and print out
and turn in the results.
In addition, in covering the two papers in class on the development of the auditing profession, we will treat
them using the Harvard case review method. I will present you with a list of questions concerning the case
that you should consider in reading it, and at the beginning of class when we meet I will discuss the facts
of the case and the questions some. Then the class will go into break-out groups to compare and discuss
their solutions to the questions, after which the class will reconvene and each of you individually are
responsible to participate and contribute to the class discussion.
Current
Topic
Write-ups &
Presentation
Each student is to (1) prepare two one-page summaries of current events
occurring in the auditing profession or the business world and (2) is to make a
presentation of some relevant event affecting the auditing profession or the
business world to the rest of the class.
The one-page summaries are to be typed, single space, with a single blank line between paragraphs. They
may discuss multiple events or a single event. It should not be a cut and paste job, but your interpretation
of the events. Your name, the course title, and current event 1 or 2 is to be indicated on the back of
the page, which is to be folded when turn in. The first paper is due January 31, and the second paper is
due March 2.
Each of you is to sign up for one current topic presentation. I will call upon you at the beginning of class.
You are to give me a copy of the article you are presenting to the class. Current topic presentations should
be different than paper topics. Late presentations are docked a point per class meeting that they are late. If
a need arises, you can call or e-mail me earlier to reschedule it.
Quizzes:
The dates of the quizzes are given on the syllabus. The first one covers the Ethical
standards (ETs) of the AICPA. The second quiz covers AU 380 to 508. The third
quiz is to write the standard audit report. The fourth quiz is a combination of multiple choice and exercises
on statistical sampling methods. Each quiz is worth fifteen points.
Debates:
Each student is to sign up from a list of topics for a short presentation of five to
seven minutes on one or another side of matters of current controversy in the
auditing profession., e.g., whether audit firms should be required to rotate from their clients periodically or
the need to pass legislation reducing auditor’s legal liabilities for lawsuits. The presentations will be made
at the beginning of class using Power Point slides; normally a pro and a con will be presented.
You are to give me a copy of your Power Point slides for the debate after completing it. I will provide you
with an example of debate notes at the beginning of the semester. You are to research several articles
discussing the topic and develop arguments (points) supporting your side of the case.
Journals:
You are to turn in a journal write-up each Mondays for the first three
weeks. Their purpose is for me to get to know you. They are to be onepage, typed and may be e-mailed if that is more convenient.
Paper:
You are to prepare and turn in a seven page, double-spaced, typed paper on some
aspect of the development of the auditing profession incorporating the two
articles that we covered in class and at least three other sources. You should see me to get the specific
topic approved. All sources are to be properly referenced, and a minimum of five sources are required.
Points will be allocated as follows: 5 pts length, 5 pts references, 5 pts footnotes, 5 pts grammar, 5 pts
development. The due date is April 4.
Mid-Term Exam/
Final:
The mid-term exam consists of a combination of multiple-choice questions and
essays/exercises. The final is comprehensive, with the material covered by the
multiple choice questions equally weighted. It also includes essays/exercises on
material covered since the last test.
ADA Statement:
If you need academic accommodations based on a disability, contact the office of
Student Support Services in Room 01, Montgomery Hall (325-3335) or email
Julie Betty at jberry@saffairs.msstate.edu
Academic
Integrity:
Accounting is a profession, the basis of which is our character and integrity.
Since you are training to be professionals, you are expected to act as such. You
are expected to abide by the honor code of the University. “As a Mississippi State
University student, I will conduct myself with honor and integrity at all times. I
will not lie, cheat, nor will I accept the actions of those that do.” The honor code
may be accessed at: www.msstate.edu/dept/audit/PDF/1207.pdf. All occurrences
of academic misconduct will be handled in accordance with the Academic
Misconduct Policy ( www.msstate.edu/web/security.html ).
Cellular Phones:
To avoid class disruptions, cellular phones and pagers must be placed in the mute
or off mode during class. The use of cellular phones during exams is not
allowed.
Important Dates:
Jan 11 – Last day for dropping a course without a grade.
Jan 12 – Last day for registration or adding a course.
Feb 16 – Last day to drop a course with a “W”.
Date
Jan
5W)
Assignments
Introduction
10(M)
Snow day
12(W)
Current topic presentation: Amber Springer, Sirish Mathema,
Laura Maye Smith
AICPA Code of Professional Conduct
Case: Leigh Ann Walker
17(M)
Martin L. King Day (Holiday)
19(W)
Current topic presentation: Lanette Balis
AICPA Code of Professional Conduct
Case: The PTL Club
24 (M)
Current topic presentation: Mollye Eaton, Sarah Foust
“How the U.S. Accounting Profession Got
Where It Is Today: Part I”- -Stephen Zeff
26(W)
Current topic presentation: Bayley Moore
“How the U.S. Accounting Profession Got
Where It Is Today: Part II”- -Stephen Zeff
31(M)
Current topic presentation: JuanJuan Cao
Debate: Sirish Mathema, Jessie Bailey
Communicating with Audit Committee
AU 380, 390, 410, 411, 420, 431
Cases 16, 17
2(W)
Current topic presentation: Holly Hudson
Debate: Greg Stumpe, Lanette Balis
Audit Reports
AU 504, 508
Cases 18, 19
7(M)
Current topic presentation: Alison Howell
Debate: Jace McCollum, JuanJuan Cao
Audit Reports
AU 508
Feb
Quiz 1-Ethics
Current Topic #1
Mar
9(W)
Current topic presentation: Jace McCollum
Debate: Ike Andrews, Alison Howell
Traditional Audit Case: Crazy Eddie
14(M)
Current topic presentation: Andrew Cornett
Debate: David Steward, Laura Amye Smith
Dating of the Independent Auditor’s Report
AU 530, 532, 534, 543, 544
Cases 20, 21
17(W)
Current topic presentation: Ike Andrews
Other Information
AU 550, 551, 552, 558
Cases 22, 23
21(M)
Current topic presentation: Hillary Carroll
Debate: Andrew Cornett, Sarah Foust
Subsequent Events
AU 560, 561, 623, 625, 634
Cases 24, 25, 26
23(W)
Current topic presentation: David Steward
Letters for Underwriters
AU 711, 722, 801, 901
Cases 27, 28
28(M)
Mid-Term Exam
2(W)
Speaker: Bill Felder, Harper, Rains, Knight & Co (Ridgeland, MS)
7(M)
Current topic presentation: Wayne Jerome
Debate: Amber Springer
Consideration of Fraud
AU 316, Case 5
Risk-Adjusted Audit Case: ZZZZ Best
9(W)
Current topic presentation: Joseph Iupe
Debate: Holly Hudson, Molly Eason
Standards & Related Topics
AU 110-230, 311, 312, 315, 317, 318
Cases 1, 2, 3, 4, 6, 7
14(M)
16(W)
SPRING HOLIDAY BREAK
SPRING HOLIDAY BREAK
Quiz 2-AU 380-508
Current Topic #2
21(M)
Speaker: Keith Winfield
23(W)
Debate: Tracy Anderson, Wayne Jerome
Business Risk-Adjusted Audit Case: Enron
26(SA)
Catch-up session
28(M)
Current topic presentation: Tracy Anderson
Internal Audit
AU 322, 324, 325, 326, 327, 328, 329, 330, 331
Cases 8, 9, 10, 11
30(W)
April 4(M)
Current topic presentation: Jessie Bailey
Debate: Bailey Moore, Hillary Caroll
Investments in Securities
AU 332, 333, 334, 336, 337, 339, 341, 342
Cases 12, 13, 14, 15
Debate: Joseph Iupe, Sean Tadlock
Audit Sampling
AU 350
6(W)
Current topic presentation: Greg Stumpe
Audit Sampling
AU 350
11(M)
Audit Sampling
AU 350
Current topic presentation:
Other Professional Services
AU 2101, 2201, 2301, 2401
Cases 29, 30
13(W)
18(M)
20(W)
April 29(F)
Quiz 3-Audit Report
Current topic presentation: Sean Tadlock
Other Professional Services
AU 2501, 2601, 2701, 3100
Cases 31, 32
Other Professional Services
AU 3200, 3300, 3400, 3600
Cases 33, 34
Final
12:00-3:00 am
Paper Due
Quiz 4-Stat Sampling