ABSTRACT: This instructional case involves charges by the Securities and Exchange Commission (SEC) against Michael Marrie, an audit partner, and Brian Berry, a manager, for recklessly failing to comply with auditing standards relating to three areas: a $12 million write-off of accounts receivable, confirmation of accounts receivable, and sales returns and allowances. The SEC believed Michael and Brian did not exercise due professional care, nor did they employ an adequate level of professional skepticism when performing the audit. The SEC also believed that there was insufficient appropriate evidence to express an opinion. This case addresses the following auditing content: Generally Accepted Auditing Standards, professional skepticism, analytical procedures, estimates, fraud risks, confirmation of accounts receivable, and work papers.
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1 February 2011
Research Article|
February 01 2011
The SEC’s Case against California Micro Devices: A Lesson in Using Professional Skepticism and Obtaining Sufficient Appropriate Evidence
Online ISSN: 1558-7983
Print ISSN: 0739-3172
American Accounting Association
2011
Issues in Accounting Education (2011) 26 (1): 145–154.
Citation
Jill M. D’Aquila, Kim Capriotti; The SEC’s Case against California Micro Devices: A Lesson in Using Professional Skepticism and Obtaining Sufficient Appropriate Evidence. Issues in Accounting Education 1 February 2011; 26 (1): 145–154. https://doi.org/10.2308/iace.2011.26.1.145
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