...Audit Process Letter Laura Sferra ACC/546 November 23, 2015 Allen Foster Mrs. Susan Right Senior Partner Anderson, Olds, and Watershed 1 Shoe Street New York, NY. 90001 Dear Mrs. Right, Mr. Lancaster, President of Apollo Shoes, has expressed his satisfaction with the services that our firm offers and would like to continue with a full audit. Because our client does not want our firm to talk to the predecessor auditor, I recommend accepting a prospective engagement after I perform an investigation by gathering information about our client's reputation and background. Client acceptance and continuance procedures are the foundation of the risk assessment process (SAS No. 8). Upon acceptance of our client, I am confident that we will be able to move forward under the AICPA auditing standards to determine that the financial reporting framework is appropriate. My objective is to plan the audit so that it is conducted efficiently and effectively, in accordance with Generally Accepted Auditing Standards. I will take into consideration the preliminary planning activities such as the client acceptance, ethical position of our audit firm and our understanding of the entity and its environment, including its internal control, to develop an effective and efficient overall audit strategy that will appropriately respond to assessed risks. Our engagement letter, will include the timetable of fieldwork, the scope and duration of...
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... |School of Business/Graduate | | |ACC/546 Version 2 | | |Auditing | Copyright © 2009, 2008, 2007 by University of Phoenix. All rights reserved. Course Description In this course, students focus on the auditing practice performed by public accountants. Topics include the CPA profession and the auditor’s role, planning the audit, audit reporting and required communications, evaluating internal controls, audit programs for current assets and liabilities, and audit programs for other business cycles. Policies Faculty and students/learners will be held responsible for understanding and adhering to all policies contained within the following two documents: • University policies: You must be logged into the student website to view this document. • Instructor policies: This document is posted in the Course Materials forum. University policies are subject to change. Be sure to read the policies at the beginning of each class. Policies may be slightly different depending on the modality in which you attend class. If you have recently changed modalities, read the policies governing your current class modality. Course Materials ...
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...of Directors, Audit Committee From: Joe Gish, CPA RE: Audit Introductory Letter Gentlemen and Ladies: It is with great pleasure that our firm, JK CPA will be conducting the annual audit of Apollo Shoes. This is a tremendous responsibility that JK CPA will undertake in being the auditors for your prestigious firm. Over the next two months, we will conduct various tests of the accounts to determine within reasonable assurance that the financial statements are free from material misstatements. Within two weeks we will send out exactly what we need from the accounting and internal audit department. This way, we want this audit to be as smooth as possible. In addition, we will also send out a detailed engagement letter along with a checklist, which will also contain our plans and goals to accomplish for the audit. I have made sure we have a solid team in place that is well versed in manufacturing and distributing companies such as yours to give you the top auditors in the field, so you can rest assured that JK CPA will cover all of your needs and then some. Once again, thank you for your choice in JK CPA as your auditors we look forward collaborating now and in the years to come. Engagement Letter: John Doe, CFO Apollo Shoes 1234 W. Main Street Anywhere, USA 00000 Dear Mr. Doe, This letter is to confirm our understanding that JK CPA will perform the audit of the financial statements of Apollo Shoes. The primary objective is the audit the financial...
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...three previous audits resulted in unqualified opinions. Toys City's year end is December 31, and Goodman & Goodman has agreed to provide the audit report on March 1, 1998, ten days before the annual board of directors meeting. Bert, the manager from Goodman & Goodman in charge of the Toys City engagement, recalls that last year there was a 25 percent budget overrun. He attributes one-third of the overrun to unforeseen circumstances and the remaining two-thirds to poor planning. He estimates that poor planning resulted in approximately 130 hours and $3,400 in audit fees that were not billed to Toys City. In an effort to avoid another costly overrun, Bert wisely decided to devote more time to audit planning. By talking to various people, Bert learns that a project management technique known as Critical Path Method (CPM) could assist an auditor in sequencing all audit detail work (including work requested from client personnel), efficiently allocating personnel resources, highlighting potential audit bottlenecks, estimating completion time, determining the probability of meeting a completion deadline, and providing a framework for relevant feedback and control as the audit progresses. Thus, he decides to spend an additional 17 hours planning this year's audit, including computer setup and analysis time, using CPM. Audit planning During the slow month of August 1997, Bert and Craig, the senior-in-charge of the Toys City engagement, analyzed the audit plan for Toys...
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...Auditing Introduction Letter To: Apollo Shoes, Inc. From: Lead Auditor Anderson, Olds, and Watershed (AOW) Date: March 30, 2015 Subject: Auditing and Other Assurance Services Available Dear Mr. Unum (Vice President of Finance), Last week you meet with Arnold Anderson, CPA (partner in charge of the audit), Darlene Wardlaws, CPA (engagement manager) and me Ashely Bishop (lead auditor) you discuss with us Apollo Shoes, Inc. decision in dismissing your current engagement with Smith & Smith auditing firm. At AOW we are glad you decided to bring us abroad. This letter will include information regarding the services that Anderson, Olds, and Watershed is able to provide to our clients as well as the professional standards that auditors must meet during audits. Also this letter will outline the ethical implications of an auditor during the audit. Auditing and Other Assurances Services Provided Arnold, Olds, and Watershed offers three different types of audits to our client’s operational, compliance, and financial statements audits. As stated in meeting last week ‘according to the Sarbanes-Oxley Act 2002, we will need to test the effectiveness of Apollo’s internal controls’ (Apollo Shoes Inc. case study). In order for our auditors to test effectiveness of the company’s internal controls will need to perform an operational audit. Operational audit evaluates the efficiency and effectiveness of any part of an organization’s operating procedures and models (Arens, Elder...
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...Superannuation Fund Street Suburb, State, PCode Dear Trustee(s), AUDIT ENGAGEMENT – YEAR ENDED 30th June 2007 Thank you for my appointment as auditor of your Superannuation Fund. As it is necessary to clarify my role to you, under the Superannuation Industry (Supervision) Act 1993 (the SIS Act) and Regulations, I wish to set out the detail of my terms of engagement as follows: 1. Audit of Financial Report In accordance, with section 113 of the Superannuation Industry (Supervision) Act 1993 (SISA), the financial report of a regulated superannuation fund must be audited by an approved auditor. The auditor must give the trustees an audit report on the financial report in the approved form within the prescribed time after the year of income to which the financial report relates. I direct your attention to the fact that the trustees are responsible for the maintenance of adequate accounting records and internal controls, the safeguarding of superannuation fund assets, the selection of accounting policies and the preparation of financial reports and returns. The trustees are required to keep minutes of meetings, reports and records of trustee changes for a period of at least 10 years. My audit will be conducted in accordance with Australian Auditing Standards. Those auditing standards require that I comply with relevant ethical requirements relating to auditing engagements and that I plan and perform the audit to obtain reasonable assurance that the financial report is free...
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...Hours Question 1 Select the best answer for each of the following unrelated items. Answer each of these items in your examination booklet by giving the number of your choice. For example, if the best answer for item (a) is (1), write (a)(1) in your examination booklet. If more than one answer is given for an item, that item will not be marked. Incorrect answers will be marked as zero. Marks will not be awarded for explanations. Note: 11/2 marks each a. An attitude of “professional scepticism” is necessary if a CGA is to perform an audit engagement with due care. Which of the following best describes how a CGA may display an attitude of “professional scepticism” when performing an audit engagement? 1) 2) 3) 4) By assuming that management is dishonest in the absence of evidence to the contrary By not allowing clients’ staff to assist in the performance of an audit By rejecting all management assertions in the absence of supporting evidence By questioning all material assertions made by management b. Which of the following steps or modifications to an audit program is likely to be the most appropriate if an auditor assesses the risk of management fraud to be relatively high? 1) 2) 3) 4) c. Performing relatively less audit work at interim dates Placing greater reliance on management’s representations Performing less extensive tests of internal controls Assigning less experienced personnel to the engagement Generalized audit software, such...
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...the three previous audits resulted in unqualified opinions. Toys City's year end is 31 December, and Goodman & Goodman has agreed to provide the audit report on 1 March, 2010, ten days before the annual board of directors meeting. Mr. Lam, the manager from Goodman & Goodman in charge of the Toys City engagement, recalls that last year there was a 25 percent budget overrun. He attributes one-third of the overrun to unforeseen circumstances and the remaining two-thirds to poor planning. He estimates that poor planning resulted in approximately 130 hours and $3,400 in audit fees that were not billed to Toys City. In an effort to avoid another costly overrun, Mr. Lam wisely decided to devote more time to audit planning. By talking to various people, Mr. Lam learns that a project management technique known as Critical Path Method (CPM) could assist an auditor in sequencing all audit detail work (including work requested from client personnel), efficiently allocating personnel resources, highlighting potential audit bottlenecks, estimating completion time, and providing a framework for relevant feedback and control as the audit progresses. Thus, he decides to spend an additional 17 hours planning this year's audit, including computer setup and analysis time, using CPM. Audit planning During the slow month of August 2009, Mr. Lam and Ms. Ip, the senior-in-charge of the Toys City engagement, analyzed the audit plan for Toys City. Basically the audit work could be divided...
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...The key areas of concern for students writing the PA exams are as follows: 1) Time management 2) Missing level 3 of the competency and jumping directly to level 4 3) Missing the competencies to be found in the exhibits in the case questions. Another concern is when students are writing both PA1 and PA2 at the same time. It is critical that those students “switch hats” from being a public practitioner in PA1 to a comptroller in PA2. And for those writing only one exam, make sure you write from the correct perspective. Consider the following for each case: 1) Type of communication (memo, letter or report) 2) Who is writing 3) To whom the case is being written to 4) The time frame. a. ie when in the audit: beginning, middle, end; there is no point writing about issues at beginning of audit if the audit is over and there is a draft audit report b. ie regarding purchase or sale of property: has the decision already been made to buy the property (shares or assets) or not; and if so, has the financing been decided. Or maybe there is an issue such as in Feed & Grow with the auditor owning shares of company to be consolidated with client; the extra shares to result in >50% ownership have not yet been bought so it is next year’s issue. The issue must still be addressed but the recommendation might be to consider the issue further. Not all issues have to be answered today; just that they must be addressed. The recommendation can be to explore...
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...Assessment | |Term and Year |3, 2013 |Time allowed |Week 9 | |Assessment Type |Assignment |Assessment Weighting |20% Total | |Date | |Room | | |Details of Subject | |Qualification |FNS60210 Advanced Diploma of Accounting | |Subject Name |Auditing and Reporting | |Details of Unit(s) of competency | |Unit Code |FNSACC602A |Unit Title |Audit and Report on Financial systems and records | |Details of Student | |Student Name ...
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...METHODIST UNIVERSITY BACHELOR OF BUSINESS ADMINISTRATION DEPARTMENT OF FINANCE AND ACCOUNTING ACCT 432: AUDITING 1 COURSE OUTLINE GENERAL OBJECTIVE To introduce students to the concept of the audit of financial statements and the issues surrounding the audit of such statements EXPECTED LEARNING OUTCOMES By the end of the course, the student is expected to be able to; a) b) c) d) e) f) Explain what is an audit and the qualifications and duties of an auditor Understand the legal and professional rules governing the audit and the auditor Able to design an adequate internal control system Able to design an audit plan and an audit program to conduct an audit Able to audit a computerized client Able to design an audit report Week Topics Content Time (Hours) Definition of auditing 3 Distinction between auditing and accounting Objectives of an audit Types of audits Appointment of an auditor Qualifications of auditors 6 1 GENERAL ENVIRONMENT AUDIT 2-3 THE LEGAL PROFFESIONAL AND Week Topics Content Time (Hours) Rights of auditors Dismissal and duties of auditors REQUIREMENTS AUDITOR 4 OF AN CONDUCTING AN AUDIT 5-6 ERRORS, FRAUD AND OTHER IRREGULARITIES 7 INTERNAL SYSTEMS CONTROL 8 9-10 CAT AUDIT EVIDENCE General audit steps 3 Accepting an audit engagement Letter of engagement Planning an audit Types of errors 6 Fraud Detection, correction and prevention of errors and fraud Role of the auditor in respect of...
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...Applying for Accounting, Audit and Tax Curriculum Vitae Fadilah bt Ahmad Zamlus Lot 129, Jalan Selendang, Kg. Charuk Puting, 28000 Temerloh, Pahang (h/p) 0111-5793287 ixora_violet@ymail.com “Seeking employment in accounting, audit, tax and accounting information system that provides a challenging opportunity combining exceptional interpersonal and technical skills” PERSONAL DATA IC No: 870508065710 Age: 25 Date of birth: 08th May 1987 Gender: Female Marital Status: Single Nationality: Malaysian Language proficiency: Bahasa Malaysia & English Health : Excellent Available for employment : August 2012 onwards EDUCATION BACKGROUND 2008 -2012 International Islamic University Malaysia (IIUM) Bachelor of Accounting (BACC) Current CGPA : 3.40 2005-2008 Universiti Teknologi Malaysia (UTMKL) Diploma in Management Technology (Accountancy) (DDW) CGPA: 3.34 2000-2004 Sekolah Menengah Agama Al-Wosto SPM: 7a’s INTERPERSONAL TRAITS, SKILLS & ATTITUDE Strengths Responsible, confident, energetic, able to work under pressure and minimum supervision, work well in team, can be a good leader in any project and good adaptation to new environment and able to communicate with superior and colleagues respectfully and efficiently. Skills - Proficient in using Microsoft Office software (Microsoft Word, Microsoft Power Point, Microsoft...
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...Week 8 – Assignment Case Study – 9.1 – Wally’s Billboard & Sign Supply 1. The audit of cash is considered an important part of an audit due to the below reasons: * Almost all business transactions will be ultimately settled through the cash accounts * Cash can be either and asset or a liability * The audit of cash accounts assists in the verification of other asset and liability accounts as well as revenue and expenses * Cash is the highly liquid asset in a company and it is an area of high inherent risk since there is a relatively high risk of misappropriation. * Investors rely on the accuracy of cash in evaluating the company’s financial well being The audit steps for cash are a routine part of an audit, therefore this part is usually assigned to new staff members or interns. However, professional skepticism should be present when reviewing cash or any other part of an audit, whether routine or not. (Hinton, Lecture Notes) 2. It is very important when an auditor develops an audit program to include thorough procedures for auditing cash balances, as it has a direct effect on an organization's profits. The auditor must perform audit procedures of the internal controls of the company to detect any shortcomings. In addition, the auditor will perform substantive tests of details, tests to detect lapping, and analytical procedures in order to verify that there is no material misstatement and to provide evidence to support the assertion...
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...Khalia Brewer Accct 555 Week 7 Homework 20-17 A.(2)- have a paymaster who has no other payroll responsibility distribute the payroll checks. B.(3)- Employees might be paid for hours they did not work. C.(3)- authorization of transactions from the custody of related assets. 20-20 |TYPE OF TEST |TRANSACTION-RELATED AUDIT OBJECTIVE(S) | |1. Substantive test of |To determine if monthly payroll costs have been correctly allocated (accuracy). | |transactions | | |2. Test of control |To determine if recorded payroll transactions are for work actually performed by existing | | |employees (occurrence). | |3. Substantive test of |To determine if employees are paid for the hours they have worked (accuracy). | |transactions | | |4. Substantive test of |To determine if the appropriate person is paid and amount and time are correct (accuracy and | |transactions |timing). | |5. Substantive...
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...Client Letter John Roth University of Phoenix ACC546 Auditing Mr. Bradford December 06, 2011 Client Letter Memorandum To: Larry Lancaster, CEO, Apollo Shoes From: Anderson, Olds, and Watershed Date: 12/12/11 Re: Audit Services Available Business nature dictates that companies must have yearly audit services provided when publicly traded. Additionally, companies not traded publicly benefit from audit services when obtaining loan or financial capital for the business. Apollo Shoes based in Shoeville, Maine and incorporated in Delaware has requisitioned Anderson, Olds, and Watershed to complete the audit for the current year. As an audit company, Anderson, Olds, and Watershed offers different types of auditing services for clients. Professionals define auditing as “the accumulation and evaluation of evidence about information to determine and report on the degree of correspondence between the information and established criteria. Auditing should be done by a competent, independent person” (Arens, Elder, and Beasley, p. 4, 2006). Where the accounting department of Apollo Shoes records and summarizes the economic events during a given period, auditing examines the information given to determine whether the data is properly recorded. The audit process will determine that the company is reasonably free of financial misstatements. Additionally, the audit will contain management report on internal controls. The next...
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