Shane White bone is getting to know his new client, Clarrie Potters, a large discount electrical retailer.
Shane White bone is getting to know his new client, Clarrie Potters, a large discount electrical retailer. Ben Brothers has been the engagement partner on the Clarrie Potters' audit for the past five years, but the audit partner rotation rules have meant that the engagement partner has had to change this year. Shane discovers that toward the end of last year, Clarrie Potters installed a new IT system for inventory control. The system was not operating prior to the end of the last financial year, so its testing was not included in the previous audit. The new system was built for Clarrie Potters by a Montreal-based software company, which modified another system it had designed for a furniture manufacturer and retailer.
What audit risks are associated with the installation of the new inventory IT system at Clarrie Potters?
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The installation of a new IT system means that results of previous audits do not necessarily apply t...View the full answer
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