Obtain a copy of the PCAOB’s report titled “Observations on Auditors’ Implementation of PCAOB Standards Relating to Auditors’ Responsibilities with Respect to Fraud.” You can use any search engine or go to www.pcaobus.org/Inspections/Documents/ 2007_01-22_Release_2007-001.pdf. In the report, the PCAOB summarizes findings from inspections of audit engagements as they relate to the performance of fraud detection audit procedures. The PCAOB report comments on auditor deficiencies in each of the following six areas:
a. Auditors’ overall approach to the detection of fraud
b. Brainstorming sessions
c. Auditors’ responses to fraud risk factors
d. Financial statement misstatements
e. Risk of management override of controls
f. Other areas to improve fraud detection
Summarize the PCAOB’s concerns with respect to problems its inspection teams have noted in auditors’ performance in each of the areas listed.