SECTION 1 Baseware Enterprises, a creator of database application packages, is a publicly held company whose stock is tr

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Section 1 Baseware Enterprises A Creator Of Database Application Packages Is A Publicly Held Company Whose Stock Is Tr 1 (80.51 KiB) Viewed 46 times

FURTHER INSTRUCTIONS:
1. Include appropriate cover page
2. There should be a table of contents
3. Appropriate headings should be used to properly sectionalize your paper
4. Minimum expected length of the paper is 5 pages.
5. APA (6th edition) formatting must be used throughout the article, as well as for in- text citation and referencing
6. There should be no more than 20% similarity in the body of the document

Section 1 Baseware Enterprises A Creator Of Database Application Packages Is A Publicly Held Company Whose Stock Is Tr 2 (80.51 KiB) Viewed 46 times

Section 1 Baseware Enterprises A Creator Of Database Application Packages Is A Publicly Held Company Whose Stock Is Tr 3 (57.73 KiB) Viewed 46 times

SECTION 1 Baseware Enterprises, a creator of database application packages, is a publicly held company whose stock is traded over the counter. The company was recently the target of an enforcement release by the SEC for inadequate internal controls. In response, Baseware Enterprises has agreed to establish an internal audit function and strengthen its audit committee. As a result of the SEC enforcement action, a manager of the internal audit department has been hired to establish an internal audit function. In addition, the configuration of the audit committee has been adjusted to include all outside directors. Baseware Enterprises has held its opening planning meeting to discuss the roles of the various participants in the internal control and financial reporting process. Members at the meeting included the president of the company, the chief financial officer, an audit committee member, a partner from Baseware Enterprises' external audit firm, and the newly appointed manager of the internal audit department. Comments by the various meeting participants are presented below. President: "We want to ensure that Baseware Enterprises complies with the SEC's enforcement action, and that this doesn't happen to us again. The internal audit department should help to reinforce our internal control system by correcting the issues. Please give me your thoughts on the proper reporting relationship for the manager of the internal audit department." CFO: "I think the internal audit department manage should report to me since a lot of the department's work is related to financial issues. Oversight responsibilities should be handled by the audit committee." Audit committee member: "I believe we should consider our roles more carefully. The recommendation from the Treadway Commission is that the audit committee play a greater role in the financial reporting process; the duties of today's audit committee
have expanded beyond the rubber-stamp approval. We need to have greater assurance that controls are in place and being followed." External audit firm partner: "We need a seamless working relationship among all of our roles. The internal audit department can play an important role in monitoring the control systems on an ongoing basis and should have strong ties to your external audit firm." Internal audit department manager: "The internal audit department should have greater involvement in operational auditing, but it also should play an important monitoring role in the financial reporting area." Required: a. Using online sources explain the function of an SEC enforcement release, such as that issued against Baseware Enterprises and describe possible responses by organizations to such an action. Also, research and discuss the existence of similar actions that can be levied locally against companies and their auditors, and the organization that would initiate them. b. Discuss the role and responsibilities of each of the following in the formation, maintenance, and assessment of Baseware Enterprises' system of internal control. i. Management ii. Audit committee iii. External auditor iv. Internal audit department c. Describe the responsibilities that Baseware Enterprises' audit committee has in the financial reporting process.