Question

Required information [The following information applies to the questions displayed below.) 0.5 Section 301 of the Sarbanes-Oxley Act requires that public companies have an audit committee. Independent auditors are increasingly involved with audit committees. points c. Select all of the following that are functions of the audit committee: (Select all that apply.) eBook Ask Check All That Apply Print Selection of the independent auditor, discussion of audit fee with the auditor, and review of the auditor's engagement letter. References Review of the independent auditor's overall audit plan (scope, purpose, and general audit procedures). Review of the annual financial statements before submission to the full board of directors for approval. Review of the results of the auditor's examination including experiences, restrictions, cooperation received, findings, and recommendations. Matters that the auditor believes should be brought to the attention of the directors or shareholders should be considered.

Answer 1

The function of audit Committee includes

• The very first point mentioned in the question the selection of the independent cost auditor and review of the auditor engagement letter
• Another function of audit committee is to review of the annual financial statements before submission to the board of directors.
• Audit committee has the right to review the results of the auditor examination including experiences, cooperation, restrictions, matters that the auditor should believe to be in consideration of the directors and shareholders.
• Review of the reports of internal audit staff comes under the purview of audit committee.
• Audit committee has the right to review audit work paper to see that the audit was conducted properly.
• Audit committee also have the power to review the qualifications of the audit staff to conduct the audit.