Memo

Memo
To:Clients
From:Accounting Firm
CC:CPAs
Date: [ 4/13/2011 ]
Re:SAS 112- Statement of Accounting Standards
In the past long time there have been some changes to the auditing standards that leave have an impression on the auditing procedures performed on your financial statements. The new standard of changes is draw in SAS 112. The new standard SAS 112 is effective now. This memo will describe some of the requirements of the new standard and how it will rival your business.

The term below are defined in SAS 112 and explains how they light upon the auditing standards:

* A obtain deficiency exists when the design or operating theater of a avow does non allow management or employees, in the normal course of acting their assigned functions, to hold or detect misstatements on a timely basis.

* A deficiency in design exists when a control incumbent to meet the control objective is missing, or the control is not properly designed so that even if it operates as designed, the control objective is not always met.

* A deficiency in operation exists when a properly designed control does not operate as designed or the person performing the control does not possess the necessary authority or qualifications to perform the control effectively.





* A significant deficiency is a control deficiency or a combination of control deficiencies that adversely affects the entitys ability to initiate, authorize, record, process or traverse financial data reliably in accordance with broadly accepted accounting principles such that there is much than a contrary likelihood that a misstatement of the entitys financial statements that is more than inconsequential will not be prevented or detected.

* A material weakness is a significant deficiency or combination of significant deficiencies that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected. ( Rebecca Otto, 2007)...If you want to get a ample essay, order it on our website: Orderessay



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