Question

Rotter & Co, Ltd, a CPA firm in Silver Bell, Arizona, has completed the audit of the financial statements of Exchecker Corporation as of, and for, the year ended December 31, 20X1. Findings related to the financial statements and the audit include:
• Exchecker is a public company that presents two years of balance sheets and three years of the other financial statements in accordance with SEC reporting requirements.
• During 20X1, Exchecker changed its method of accounting for long-term construction contracts and properly reflected the effect of the change. Rotter is satisfied with Exchecker’s justification for making the change. The change is discussed in Note 12.
• Rotter was unable to perform normal accounts receivable confirmation procedures, but alternate procedures were used to satisfy Rotter as to the validity of the receivables.
• Exchecker Corporation is the defendant in litigation, the outcome of which is highly uncertain. If the case is settled in favor of the plaintiff, Exchecker will be required to pay a substantial amount of cash that might require the sale of certain assets. The litigation and the possible effects have been properly disclosed in Note 11. Rotter wishes to include discussion of this matter in the audit report.
• Rotter gathered sufficient appropriate audit evidence as of February 10, 20X2, and planned a report release date of February 16, 20X2.
Consider all facts given, and prepare an auditors’ report in an acceptable and complete format incorporating any necessary departures from the standard report.



$1.99
Sales2
Views95
Comments0
  • CreatedOctober 27, 2014
  • Files Included
Post your question
5000