An Auditor Suspects Its Client Is Committing Illegal Acts That

question 7

Essay

An auditor suspects its client is committing illegal acts that will have a material impact on its financial statements.What is the auditor legally required to do and under what circumstances would the auditor directly notify the SEC?

---

Definitions:

Denatured

Loss of a protein’s or enzyme’s normal shape so that it no longer functions; usually caused by a less than optimal pH and temperature.

Enzyme Structurally

Refers to the three-dimensional arrangement of atoms in an enzyme, which is critical for its catalytic activity and specificity.

Cofactor

Nonprotein assistant required by an enzyme in order to function. Many cofactors are metal ions; others are coenzymes.

Inhibitor

A substance that slows down or prevents a particular chemical reaction or other process.