During his review of subsequent events in connection with the audit of Jordan Match Company, Ron Gray,
Question:
During his review of subsequent events in connection with the audit of Jordan Match Company, Ron Gray, CPA, was informed by the corporate secretary that, although there had been two meetings of the board of directors subsequent to the audit date, no minutes had been prepared. The corporate secretary stated that he had been too busy to prepare the minutes but that the meetings had been routine and no significant matters had been discussed that would require disclosure in the financial statements. He offered to give Gray a letter to this effect.
Discuss each of the following courses of action open to Gray.
a. Accept the letter from the corporate secretary (who will be the one who subsequently prepares and signs the minutes) and issue the audit report.
b. Refuse to accept the letter of the corporate secretary and refuse to issue the audit report.
c. Attend the next board of directors' meeting and obtain oral confirmation that no significant matters had been discussed that would require disclosure in the financial statements.
What action should Gray take?
Step by Step Answer:
Auditing An Assertions Approach
ISBN: 9780471134213
7th Edition
Authors: G. William Glezen, Donald H. Taylor