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You Are Auditing a Company Whose Management Has Intentionally Made

Question 40

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You are auditing a company whose management has intentionally made adjustments to various financial statement items that are not in accordance with generally accepted accounting principles.This behavior has occurred over a number of accounting periods.None of the individual adjustments by itself is material and the aggregate effect on the financial statements taken as a whole is immaterial.Top management of the client are aware of these misstatements and consider them part of their strategic management of earnings.
Explain how you as the independent auditor should respond to this situation.

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The fact that the client's records conta...

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