You are engaged in the first audit of Microdent, Inc. The corporation has both a stock transfer agent and an independent registrar for its capital stock. The tranfer agent maintains the record of stockholders, and the registrar determines that there is no overissue of stock. Signatures of both are required to validate stock certificates.
It has been proposed that confirmations be obtained from both the transfer agent and the registrar as to the stock outstanding at the balance sheet date. If such confirmations agree with the accounting records, no additional work is to be performed as to capital stock.
If you agree that obtaining confirmations as suggested would be sufficient in this case, give the justification for your position. If you do not agree, state specifically all additional steps you would take and explain your reasons for taking them.
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