Farisha Berhad (Farisha) has appointed MNO Associates as its external auditor since 2012. MNO provides both audit and ta

[answerhappygod]

Farisha Berhad (Farisha) has appointed MNO Associates as its
external auditor since 2012. MNO provides both audit and taxation
services to Farisha. Over the five-year period from 2015 to 2020,
MNO’s audit fee tripled. The audit fees paid by Farisha were twice
as high as the audit fees paid by other companies to their auditors
in the same industry. The tax consultation fees paid to MNO were
also higher than the industry average. When someone informs the
Chairman of the company on the accounting fraud that happened in
the company, it was suspected that the external auditors allowed
various accounting irregularities such as improper verification of
cash and bank balances by accepting management’s explanation
verbally. Internal auditors were appointed from MNO but different
departments also failed to enquire information from the management
on the issue of the company taking a debt of RM200 million in the
latest financial year when the company had RM4.4 billion of cash
lying unused in its accounts. Later, it was discovered that the
cash amount was faked and could be easily discovered if the
internal auditors have enquired further on the issue. Using a case
study technique, advise the Chairman of the company on the best
course of action he should take. ( Total / Jumlah: 20 )