Final answer:
The option 'Review changes in internal control during the period subsequent to the balance sheet date' is not a typical procedure for searching for significant post-balance sheet events. Auditors focus on reviewing board minutes, interim financial statements, and inquiring about unusual adjustments post-balance sheet date to search for significant events.
Step-by-step explanation:
The question pertains to the procedures that auditors perform during the subsequent period after a company's financial year-end to identify any significant events that could affect the financial statements. Among the listed options, Review changes in internal control during the period subsequent to the balance sheet date is not a typical procedure for searching for significant post-balance sheet events. Instead, auditors generally focus on the following activities:
- Review minutes of board of directors' meetings to understand any decisions that could impact the financial statements.
- Review the latest available interim financial statements to catch any significant changes or transactions.
- Inquire about any unusual adjustments made subsequent to the balance sheet date, which could indicate events requiring disclosure or adjustment in the financial statements.
In the context of corporate governance, the board of directors, auditing firms, and large shareholders form the structure that oversees and verifies the financial information presented by the company. The failure of corporate governance, as exemplified by the Lehman Brothers case, results in the misleading of investors and other stakeholders about the company's true financial condition.