ACCO-465-CASES-Midterm.docx - 2 Sparkyu2019s Auto Parts To...

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2. Sparky’s Auto Parts To: Audit Partner From: Staff Accountant Subject: Preliminary audit planning memo for Sparky’s Auto Parts 3. The Bad Guys To: Engagement Partner From: Audit Manager Subject: Planning Memo for Mobilia’s year-end financial statements 4. Joanne or Joanna? To: To the Audit File From: Engagement Partner Subject: Memo Regarding meeting with Joanne 5. I’m Board: To: I’m Board’s Owner From: Staff Accountant Subject: Planning Email of audit program for January 1, 2012 opening balances of capital assets 6. IceBox Foods: To: The Audit Team From: Audit Manager Subject: Preliminary File Review on the inventory portion of the audit 7. Who’s The Boss?: To: Audit Team From: Audit Team Subject: Memo (to the audit file) to indicate (and justify) the decisions taken regarding each of the clients’ “requests” and list additional tests
2. Sparky’s Auto Parts Concerns/Issues with Audit Planning Memo (CAS 300, 510) Required – write an Audit Planning Memo, for FIRST time audit of f/s Role – You are auditor SUGGESTED KEY TOPICS TO INCLUDE IN SOLUTION:
2. Materiality – consider whether revenue should be normalized given the unusual growth in past 2 years. Consider using assets to calculate materiality, likely more stable over the years.Consider setting specific materiality levels for sections such as for HST and R&D. 3. Key risk areas – HST – no remittance filed, potential penalties, additional liability/accrual to consider?
4. Conclusion CONCLUSION - Summarize briefly KEY points above (e.g. lack of controls and high risk areas)
3. The Bad Guys Role: Audit Manager Context: New Audit Client with high FR Required: Write memo (to the audit file or the audit partner) to indicate course of action

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