Livent, Inc. is a company that is very involved in the entertainment business, mainly in live theatrical productions. When dealing with a company in the entertainment industry, there are many risks that can be involved in auditing situations. A big risk that can be common is working with the higher officers of the company who are not strongly educated in the financial field. They are only familiar with the entertainment part of it and do not pay attention to a lot of the finances. It is common for the board and higher management in the entertainment field to only worry about the amount of talent provided in their product and the amount of people that are in the seats. They do not know and commonly do not want to know how much it costs because it is not on their priority list. Their main goal is to put the best actor and actress on the stage and put as many people in the seats as possible. A risk that was common in Livent was their ability to take costs for one show and moving some of it to another show for the future or in the past that had been more successful. Auditing for live theatrical performances is a little different than a typical audit. The auditors have to look at so many different costs, investments, revenue from multiple shows and periods, and much more. A possible strategy is auditing the company without much communication between the auditing client and the CEO or other top officers of the company.
The responsibilities of a CFO and an audit partner are similar and different. The CFO is a highly ranked officer of a company who oversees the spending habits of a company and all of its financial reports, activities, and situations. The CFO makes sure that the assets spent are spent wisely and should be spent for the right reasons. They want to be sure it used for the growth and benefit of the company. An audit partner is usually a third party person that a company chooses from an externally client, to come in and review all the accounting...
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