Auditing accounting estimates
Read the Case 7.1 Ligand Pharmaceuticals in the Knapp casebook. you will find it in the book. page 433-338
Prepare and submit a 2-3 page paper analyzing the Ligand Pharmaceuticals case.
- What went wrong in the auditor’s risk assessment procedures?
- Which of the three methods for substantively testing the estimate did the auditor choose?
- What could or should the auditor have done differently?
The standard should be used for this case + reading that on the attachment
- PCAOB AS 2501: Auditing Accounting Estimates, including Fair Value Measurements
- AICPA Statement on Auditing Standards No. 14