Auditing And Assurance Services

Auditing & Assurance Services Auditing & Assurance Services Timothy J. Louwers, PhD, CPA, CISA, CFF Director of the School of Accounting and KPMG Eminent Professor in Accounting Allen D. Blay, PhD, CPA Associate Professor of Accounting Florida State University David H. Sinason, PhD, CPA, CIA, CFE, CFSA, CRMA PwC Professor of Accountancy Northern Illinois University Jerry R. Strawser, PhD, CPA KPMG Chair of Accounting Texas A&M University Jay C. Thibodeau, PhD, CPA Rae D. Anderson Professor of Accounting Bentley University AUDITING & ASSURANCE SERVICES, SEVENTH EDITION Published by McGraw-Hill Education, 2 Penn Plaza, New York, NY 10121. Copyright 2018 by McGraw-Hill Education. All rights reserved. Printed in the United States of America. Previous editions 2015, 2013, and 2011. No part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written consent of McGraw-Hill Education, including, but not limited to, in any network or other electronic storage or transmission, or broadcast for distance learning. Some ancillaries, including electronic and print components, may not be available to customers outside the United States. This book is printed on acid-free paper. 1 2 3 4 5 6 7 8 9 LWI 21 20 19 18 17 ISBN 978-1-259-57328-6 MHID 1-259-57328-1 Chief Product Officer, SVP Products & Markets:  G. Scott Virkler Vice President Portfolio & Learning Content:  Michael Ryan Managing Director:  Tim Vertovec Marketing Director:  Natalie King Brand Manager:  Patricia Plumb Director, Product Development:  Rose Koos Associate Director of Digital Content:  Kevin Moran Lead Product Developers:  Michele Janicek / Kristine Tibbetts Senior Product Developer:  Rebecca Mann Product Developer:  Randall Edwards Marketing Manager:  Cheryl Osgood Digital Product Analyst:  Xin Lin Director, Content Design & Delivery:  Linda Avenarius Program Manager:  Daryl Horrocks Senior Content Project Managers:  Dana M. Pauley / Angela Norris Buyer:  Laura M. Fuller Design:  Matt Diamond Content Licensing Specialists:  Shawntel Schmitt / Lori Slattery Cover Image:  The-Lightwrighter/Getty Images Compositor:  SPi Global Printer:  LSC Communications All credits appearing on page or at the end of the book are considered to be an extension of the copyright page. Library of Congress Cataloging-in-Publication Data Names: Louwers, Timothy J., author. Title: Auditing & assurance services / Timothy J. Louwers, James Madison University, David H. Sinason, Northern Illinois University, Jerry R. Strawser, Texas A&M University, Jay C. Thibodeau, Bentley College, Allen D. Blay. Other titles: Auditing and assurance services Description: Seventh edition. | New York, NY: McGraw-Hill Education, [2018] Identifiers: LCCN 2016042220 | ISBN 9781259573286 (alk. paper) Subjects: LCSH: Auditing. Classification: LCC HF5667 .A815 2018 | DDC 657/.45—dc23 LC record available at https://lccn.loc.gov/2016042220 The Internet addresses listed in the text were accurate at the time of publication. The inclusion of a website does not indicate an endorsement by the authors or McGraw-Hill Education, and McGraw-Hill Education does not guarantee the accuracy of the information presented at these sites. mheducation.com/highered Some people come into our lives and quickly go. Some stay awhile and leave footprints on our hearts and we are never quite the same. Anonymous We dedicate this book to the following educators whose footprints we try to follow: Professor Homer Bates (University of North Florida) Professor Stanley Biggs (University of Connecticut) Professor Lewis C. Buller (Indiana State University) Professor Patrick Delaney (Northern Illinois University) Professor William Hillison (Florida State University)