Identify Departures from GAAP. The balance sheet and statement of activities for the Central Area Disadvantaged Youth Center for fiscal year 2011, prepared by a volunteer accountant with business experience,

Required
a. Assume that you are the independent auditor performing a financial statement audit of the center. Identify and make a list of your concerns based on your review of the center€™s financial statements. Would you feel comfortable issuing an unqualified i.e., €œclean€) opinion on the Central Area Disadvantaged Youth Center€™s financial statements?
b. What actions would you require of the center€™s management to address your concerns before you would be willing to perform this audit? What would be your recourse if the center refused to take the recommended actions? (You may wish to refer to Chapter 12 in forming your answer to thesequestions.)

CENTRAL AREA DISADVANTAGED YOUTH CENTER Balance Sheet As of December 31, 2011 Assets Cash $ 26,802 71,143 16,372 investments Contributions recelvable Supplies and other prepaid expenses Land Buildings (net of accumuiated depreciation of $63,420) Equipment (net of accumulated deprecation of $87,642) 13,258 70,000 249,750 184,230 Total assets $631,555 Uabilities and net assets Llabilitles Accounts payable Accrued llabilities $ 25,722 4,963 Total labilities 30,685 Net assets invested in property, plant, and equipment Other net assets 503,980 96,892 Total net assets 600,870 $631,555 Total labilities and net assets CENTRAL AREA DISADVANTAGED YOUTH CENTER Statement of Activitles For Year Ended December 31, 2011 Revenues and contributions $ 69,250 Contributions from donors Granits From United Way From state government Contributed goods and services interest on investments MIScellaneous-sale of refurbished goods 15,000 22,000 43,500 3,200 6,900 Total revenues and contributions 159,850 Expenses Payroll Payroll taxes Travel and conferences Promotion and advertising Cast of donated goods and services Food, recreational, and other supplies Postage, printing, and copying Building and equipment maintenance unlties 62,580 4,605 2,795 1,430 32,600 18,310 1,057 3,100 4,378 Depreciation Miscellanecus 12,700 10,380 Total expenses 153,935 Increase In net assets 5,915 Net assets, December 31, 2010 625,640 Net assets, December 31, 2011 $ 631,555