AU 722.32

When conducting a review of interim financial information, the accountant may become aware of fraud or possible illegal acts. If the matter involves fraud, it should be brought to the attention of the appropriate level of management. If the fraud involves senior management or results in a material misstatement of the financial statements, the accountant should communicate the matter directly to the audit committee as described in section 316, Consideration of Fraud in a Financial Statement Audit, paragraphs .79 through .82. If the matter involves possible illegal acts, the accountant should assure himself or herself that the audit committee is adequately informed, unless the matter is clearly inconsequential. ^fn 21 (See section 317, Illegal Acts by Clients, paragraph .17.)