Auditing and Accounting Cases: Investigating Issues of Fraud and Professional Ethics 3rd Edition by Jay Thibodeau,Deborah Freier

Exercise 4

Consult Paragraph 25 of PCAOB Auditing Standard No. 5 and/or AU Section 319.34. Define what is meant by control environment. Next explain why the control environment is so important to effective internal control over financial reporting at an audit client like WorldCom.