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Just For Feet's 1998 Financial Audit

1389 Words6 Pages

AUDITOR’S ROLE Deloitte & Touche, LLP served as the audit firm for Just for Feet since 1993. Steven Barry was the managing partner at Deloitte & Touche, and served as the engagement partner during Just for Feet’s 1998 financial statement audit. Karen Baker was a manager at Deloitte & Touche, and served as the audit manager during Just for Feet’s 1998 financial statement audit. Deloitte & Touche received $351,756 for their audit performance during the 1998 audit. According the (Securities and Exchange Commission (2005), Deloitte & Touche, Steven Barry and Karen Baker engaged in “improper professional conduct (p. 2)” in connection with the 1998 audit of Just for Feet’s financial statements. They issued an unqualified audit opinion stating Just for Feet’s 1998 financial statements were free of material misstatements and in conformity with GAAP, and that they performed the audit using Generally Accepted Auditing Standards (GAAS). …show more content…

Even though Just for Feet management and vendors colluded to deceive the auditors, the SEC charged that the auditors should have discovered that Just for Feet’s 1998 financial statements were not prepared in accordance with GAAP. The auditors, during the 1998 audit, did not execute their 1998 audit properly based on the 1997 audit identification of Just for Feet as a “greater than normal” audit risk. Prior risk assessment working papers described Just for Feet fraud risk factors

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