You are the manager of the examination engagement of the financial projection of Honey’s Health Foods as of December 31, 2013, and for the year then ended. The audit senior, Currie, has prepared the following draft of the examination report:
To the Board of Directors of Honey’s Health Foods:
We have examined the accompanying projected balance sheet and statements of income, retained earnings, and cash flows of Honey’s Health Foods as of December 31, 2013, and for the year then ending. Our examination was made in accordance with standards for an examination of a projection and accordingly included such procedures as we considered necessary to evaluate the assumptions used by management.
In our opinion, the accompanying forecast is presented in conformity with guidelines for presentation of a forecast established by the American Institute of Certified Public Accountants, and the underlying assumptions provide a reason-able basis for management’s projection. However, there will usually be differences between the projected and actual results because events and circumstances frequently do not occur as expected, and those differences may be material.
Libby & Nelson, CPAs

Identify the deficiencies in Currie’s draft of the examination report. Group the deficiencies by paragraph.

  • CreatedSeptember 22, 2014
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