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Analyze each of the following situation below and provide your assessment of the potential resolution of...

Analyze each of the following situation below and provide your assessment of the potential resolution of each scenario, including potential liability for the auditor or audit firm involved.(in detailed )

- Fuji Film filed for a bankruptcy in January 2012. A recent blog suggested that Fuji’s external auditors should be sued for failing to qualify the firm’s opinion on the financial statements issued before the bankruptcy, even though the fair presentation of the financial statements is not being disputed.

thank you and I really appreciate youe help ~

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Answer #1

External audit firms are responsible for providing reasonable assurance that the financial statements are free from material misstatements and prepared according to an accounting framework. External auditors are not there to fix the problems, although many will provide you with recommendations. External audit firms also are not responsible for providing absolute assurance of perfect financial statements; they only test enough data to provide reasonable assurance. Hence the external auditors are not potentially liable for failure to qualifythe firm’s opinion on the financial statements.

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