Describe the purposes of audit documentation and explain why each purpose is important…. 1 answer below »

Overview: After reading The Runner’s Shop case study in your textbook, respond to questions one through four. These questions will provide the opportunity to

practice reviewing audit documentation to support management assertions. Use examples from the case and at least one scholarly source (other than your

textbook) to support your responses.

Prompt: Specifically, the following critical elements must be addressed:

? Describe the purposes of audit documentation and explain why each purpose is important.

? Review Green and Brown LLP’s audit documentation guidelines and explain why an audit firm would want to include each of the listed items in its audit

documentation.

? Review the audit documentation prepared by Green and Brown LLP, related to Transaction Reporting System’s (TRS) notes payable, and list deficiencies

on the enclosed schedules.

? Green and Brown LLP would not be required to comply with the auditing standards of the Public Company Accounting Oversight Board (PCAOB) for the

TRS audit because TRS is a private company. Setting this fact aside for the moment, go to the PCAOB website and review Standard No. 3: Audit

Documentation (see www.pcaob.org). This standard requires that documentation of audit work contain sufficient information to enable an experienced

auditor not involved with the engagement to achieve two objectives. What are these two objectives? Explain whether you believe the audit

documentation in this case achieves these objectives

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