Spencer, CPA, has been engaged to audit the fair value measurements of Christensen & Son, a high- tech company in the Midwest. During the audit, Spencer must obtain evidence that management of Christensen & Son has appropriately valued the following two accounts:
1. Available- for- Sale Stock Portfolio, containing investments in Fortune 100 company stocks.
2. Stock compensation expense related to stock options granted to Christensen’s employees as valued by the Black- Scholes option- pricing model. Christensen’s stock is largely held by the owners and neither the company’s stock nor the related stock options are actively traded.

Required:
For each account, complete the following:
a. Identify the fair value inputs to the value of each account.
b. Identify the valuation levels for each of the identified inputs as well as the account as a whole (\i. e., Level 1, Level 2, or Level 3).
c. Create a summary audit plan, by account, for how Spencer can obtain assurance regarding the fair value of each of the inputs.