1- Why would auditors want to know about their clients’ business-related risks? ( cite source)
2- What are related party transactions? ( cite source)
a. Why do related party transactions pose a risk to audit firms?
b. Read about the related parties at The Company. Are there any situations that cause you particular concern?
3- Read management’s report on internal control ( cite source)
a. What did management conclude about the effectiveness of its internal controls?
b. What basis did management use to make that assessment?
c. Did the auditors agree with management’s assessment of the effectiveness of its internal controls?
d. Does the Company have any comments made by the staff of the SEC that were unresolved when its latest Form 10K was filed?
4- Read the report of the independent registered public accounting firm for The Company. Notice that the report clearly articulates differential responsibilities on the part of management versus the audit firm. ( cite source)
a. Why is it important that the audit firm articulate these responsibilities in this way?
b. Name the independent registered public accounting firm
c. What type of opinion did the independent registered public accounting firm render on the latest financial statements?
d. Were there any modifications to the report of the independent registered public accounting firm. If so, describe the modification and the reason for it
5- Based on your research and readings about the Company state and explain your conclusion about whether the independent registered public accounting firm should continue to serve as the auditor for the Company. ( cite source)