RSM 323 - Case Assignment _2 Practice - Case Question

RSM 323 - Case Assignment _2 Practice - Case Question - LH...

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Fall 2010 Page 1 of 4 RSM 323 Case Assignment #2 Practice Case Question Super Circuits Limited (“SCL”) is a Canadian private company. It was incorporated in 1990 by its sole common shareholder, Lavender Brown. SCL manufactures, installs, and provides product support for its line of surveillance cameras. Lavender started the company with a small investment. In the late 1990s the company grew rapidly. Most of the expansion was funded through debt financing. The rapid growth is attributable to several large contracts signed with banks for the installation of security camera systems at their branches. SCL has a June 30 year-end. You, CA/CGA/CMA, are with the firm of Black & Lupin Chartered Accountants (“BL”). Your firm has performed the audit of SCL since its incorporation and prepares SCL’s corporate tax returns and those of Lavender Brown and her family. Lavender Brown called you in April 2010, just as you were about to start planning the audit to inform you that she plans to take SCL public within the next year. She has since been negotiating with several underwriters (who will assist in the initial public offering) but no deal is in place yet. During the telephone conversation, Lavender asked you and the Partner on the audit to meet with her sometime in early June to discuss and resolve potential issues related to the June 30 audit of SCL. In prior years, Financial Statements were issued in September, but this year the deadline for finalizing the Financial Statements will likely be in early August. Lavender agreed that you would perform your interim audit procedures based on SCL’s results as at April 30, 2010. It is now June 2010. The interim work for the fiscal 2010 audit has been completed. A summary of any new items noted in the April 30, 2010 interim Financial Statements as a result of work done to date is included in Exhibit 1. You are about to leave for the day when the Partner in charge of the account comes into your office and announces that he has just received a call from Lavender and she would like to meet with the Partner within the next few days. The Partner asks you to prepare an updated planning memo discussing the effects of the new findings from the interim audit work and any other matters that he should raise at the meeting. Required:
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This note was uploaded on 05/09/2011 for the course RSM 323 taught by Professor Lisaharvey during the Spring '11 term at University of Toronto- Toronto.

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RSM 323 - Case Assignment _2 Practice - Case Question - LH...

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