DDD Motor Sales Inc. is privately owned. It wants to expand its business and has approached its bank for a loan. DDD wants the funds to purchase additional inventory and will be able to provide excellent security to the bank. The bank has agreed that since DDD can provide good security for the loan, an external audit will not be required. The bank manager has insisted that DDD hire a firm of professional accountants to examine DDD's financial records and provide some level of assurance.
Required
(a) What type of engagement is required? Explain your answer.
(b) Assume that DDD contracts with Cicak & Jones, CGA's, to perform the required services. What is the title of the report or communication that Cicak & Jones will prepare?
(c) Identify the type of procedures Cicak & Jones will be required to conduct.