Assignment Instructions

1. Complete exercise 7 (below)
2. Complete the five steps of the research problem and documenting each step to advise your client how to record and report issues concerning lease obligations. You will identify research issues and collect evidence for your rationale from various sources. The resources linked in the first study of Unit 1 may be of use to you.
3. Submit a brief report on exercise 7 in a Word document. Cite appropriate accounting standards to support your answers to the case scenario.

Submission Requirements

• Written communication: Written communication is free of errors that detract from the overall message.
• APA formatting: Resources and citations are formatted according to APA (sixth edition) style and formatting.
• Length: 34 double-spaced, typed pages, including cover and reference pages.
• Fontandfontsize:TimesNewRoman,12point.

Exercise 7

An audit partner of a CPA firm invested in a computer side business with a member of the board of directors of a public company that sells insurance and is an audit client of that CPA firm. Identify any potential problems. Conduct preliminary research to find the relevant source at issue. Refine the problem statement. Research and locate the relevant professional authorities, and determine whether there is any colorable authority in the law that prohibits such a relationship. If so, try to find the interpretation of the law that the SEC may have issued. Analyze, consider alternatives, and develop the conclusion. Write a research memo on the problem.