The director of auditing for a large utility company just assigned his last available auditors to examine the company’s coal-mining operations in a neighboring state. They were scheduled to leave on a flight the following morning. At three o’clock in the afternoon the operations vice president called expressing his suspicion that a fraud was being committed in one of the company’s supply warehouses. He demanded an immediate audit.

Required:

a. Assuming the only possible auditors that might be assigned were those scheduled to leave the following morning, what major considerations would determine whether they should be rescheduled immediately for an audit of the warehouse?

b. How would your response be influenced by the presence of a security department within the entity?