Board authorize outside auditors for non audit work

can the Board authorize outside auditors for non audit work ? I picked NO. Any one ?

I picked No too!

Yeah, picked no on this also…

i chose Yes =(

are we right ? :slight_smile:

I picked no but I think in another thread someone said there was one line somewhere in the CFAI texts that said they do.

I think you remember the question wrong…it never asks the approval for outside to do non-audit work: http://www.analystforum.com/phorums/read.php?12,771234

I remember there are two parts of this question, can any one remember what’s the first part?

I thouhgt the question was about bards powers - I assume this is what the question meant - can it get to audit the non-audit work provided by the existing auditors (eg: consulting by the same audit firm). So, I picked it should be able to monitor it… Can the board pick external auditors (is that the first question in this ?) FOr that my answer was yes, but am not sure… Did anyone else read it like this?

this was poorly worded

not sure about the question, but i believe the general concept is this: The Board or Audit committe (not sure which) must authorize any non-audit work performed by auditors. This is done to eliminate any potential conflicts of interest. This is why many consulting arms broke off their parents a few years back (i.e. KPMG and Bearing Point I believe) (Andersen and Accenture). If managment could hire the consulting side to do lots of work on the non-audit side, it could put pressure on the audit folks to let things slide.

page 208 of the CFAI corporate finance book indicates that they SHOULD have authority for authorizing non-audit services.

im pissed i got this wrong. almost the same question from level 1.

I’m pretty sure that they did ask whether they board should be able to (or be required to?) approve non-audit work. I also put that they should have control over the non-audit consulting work.

It was a two part question, wasnt it. I had a YES and a NO (for the “can the Board authorize outside auditors for non audit work”) part.

I think …auditors should not mix audit fuction with non- audit function with the same client, and therefore, directors should not involve with approving non- audit functions as it is management’ job. so i selected " no"

Slash Wrote: ------------------------------------------------------- > page 208 of the CFAI corporate finance book > indicates that they SHOULD have authority for > authorizing non-audit services. Agreed. Just curious - is the “they” the Board or the Audit Comittee?

  1. For independent board members to pick outside auditors 2) For board (audit committee?) to approve non-audit service

nerdattax Wrote: ------------------------------------------------------- > Slash Wrote: > -------------------------------------------------- > ----- > > page 208 of the CFAI corporate finance book > > indicates that they SHOULD have authority for > > authorizing non-audit services. > > > Agreed. Just curious - is the “they” the Board or > the Audit Comittee? the audit committee of the board

what a cheap question