Tag: Auditing

Less than a month ago, on March 10, the world was stunned to hear the news of the collapse of Silicon Valley Bank (SVB). Once a darling of the tech industry,
the bank was seized by its state regulator and received by the FDIC due to inadequate liquidity and solvency. SVB’s collapse was the second-largest bank
failure in U.S. history. Soon after news of SVB’s failure began to break, it became apparent that the bank’s auditor, KPMG, had signed off on SVB’s financials
only two weeks before its collapse, citing no issues with the company’s ability to continue as a “going concern.” This raised questions as to the quality of
KPMG’s audit and prompted calls for the auditor to be held accountable.
What caused the collapse of SVB? Provide a brief overview.
SVB also issued a clean audit opinion for Signature Bank 11 days before its collapse. Do the two bank failures point to an audit quality issue at KPMG? Why
or why not?
KPMG claims that the issues that caused the collapse did not occur within the period covered by the audit. Based on what you’ve learned so far in this
course, do you believe this is an adequate explanation?
KPMG audited SVB for 29 years, which reignited the debate over whether limits should be imposed on how long a firm can audit a company before rotating
off. What do you think?

Why is an audit considered to be the final phase of a budgetary process?

For your final project for this course, you will assume the role of an auditor at a large accounting firm, preparing to perform an audit of financial records for Robbins Network Solutions (RNS). As with any audit, the audit team is not always going to have access to all the information and resources they want prior to starting and working on the audit. That is real-world auditing. The assignment is intended to mimic what auditors face in their career. Do the best with what you have, using auditing standards and critical thinking. Support all your responses based on the material you have.