Winter2009Ass01Solution - ACTG 3P11 Assignment #1 Suggested...

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ACTG 3P11 – Assignment #1 Suggested Solution 1-23 (10 marks – as italicized, 2 marks each) The PA firm for the Internet company described in this problem could address these customer concerns by performing a WebTrust attestation engagement. The WebTrust assurance service was created by the profession to respond to the growing need for assurance resulting from the growth of business transacted over the Internet. Relevant principles for each of the customer concerns noted in the problem are as follows: processing integrity for: Accuracy of product descriptions and adherence to stated return policies online privacy and security for: credit card and other personal information online privacy and security for: selling information to other companies availability for: system failure 2-19 (10 marks (max) – as italicized) Harris is caught between two rules . One requires disclosure of material facts known by the member —i.e., that Master Furniture is not likely to realize its substantial receivable from Fine Deal and so its receivables are significantly overstated. The second requires Harris to maintain the confidentiality of the information gained as auditor of Fine Deal. This situation is not uncommon in smaller centres where the same public accounting firm may do the audit for a number of companies that have business dealings with each other. Harris should first ask Fine Deal to disclose their financial condition to Master Furniture so that the latter can value their accounts receivable. Perhaps, Fine Deal could be persuaded to issue their financial statements with an appropriate note. Harris knows that the bank is about to make a sizable bank loan to Master Furniture
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This note was uploaded on 10/22/2009 for the course ACCT 70360 taught by Professor Pathak during the Spring '09 term at Windsor.

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Winter2009Ass01Solution - ACTG 3P11 Assignment #1 Suggested...

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