VIETNAM NATIONAL UNIVERSITY - HCMCINTERNATIONAL UNIVERSITY------oOo------Assignment 2 GROUP MEMBERS: Name IDPhan Dieu Hien BAFNIU15132Nguyen Phuong Thuc Hien BAFNIU15097Truong Thi Hoai Linh BAFNIU15166Bui Trang My Linh BAFNIU15006HoChiMinh City, March 2018AUDITING1
EARTHWEAR CLOTHIERS MINI-CASEChapter 1: EarthWear Introduction WorksheetQ1. Who is the current CEO of EarthWear?The current CEO is Calvin J. RogersQ2. How much did Accounts Payable change in dollars and percent from 2012 to2013?Account Payable increased $14,077 and 29.07% from 2012 to 2013.Q3. In which of the last 5 years was EarthWear's Net Income highest, and what wasNet Income in that year?In 2010, the Net Income was the highest and it was $41,698.Q4. Does EarthWear use the FIFO or LIFO inventory valuation method?EarthWear uses the LIFO inventory valuation method.Willis & Adams, CPAs Website ()Q5. What 5 services does Willis & Adams, CPAs provide to clients?They are Assurance Services, Tax Planning, Business Planning, Valuation Servicesand Litigations Support Services.Q6. What are the names of the three current staff accountants listed on the Willis &Adams website?They are Michael Willis, Scott Adams and Karen Mitchell.Q7. What is the date of Willis & Adams' most current engagement letter withEarthWear?It is April 1, 2013.2
Chapter 3: Client Acceptance, Audit Planning Memo, Materiality andTolerable Misstatement1. Client Acceptance EARTHWEAR CLOTHIERS5-MarClient Continuance EvaluationInitialHere31-Dec-143/1/18General Risk IndicatorsInstructions: Evaluate and answer the following unanswered questions regarding the risk of retaining EarthWear as an audit client. Click on the yellow boxes and select either "Yes" or "No" fromthe drop down menu.If you selected 'Yes' on any of the questions to the left, provide and explanation below:Are there any concerns about undue reliance being placed on the results of our work? (i.e. saleof the company, financing)NoDoes the client have any associated entities that are not audited or are being audited by firms outside of Willis and Adams?NoHave any situations been noted that bear on the integrity of management?YesEarthWear's vice president of finance, Don Evans, was charged with a misdemeanor involving illegal gamblingIs there evidence that the business is financially distressed?NoIs the client imposing on us any unreasonable scope or timing restrictions?No3
Is the client's industry or business characterized by significant operating, economic, product, of other commercial risk? (Examples of such risks include: development or start-upstage, high risk industry, an industry with relatively short product lives, or product(s) of unknown or doubtful commercial feasibility.)NoAre there any pending enforcement matters or other investigations the outcome of which could adversely impact the viability or reputation of the business?
You've reached the end of your free preview.
Want to read all 24 pages?