Assume you are an organization's controller/CFO (you can define the organization in any way you please). The organization's independent auditor is a CPA firm. The audit has been performed by this business for several years, but the contract is due for renewal in six months. You were satisfied with the audit firm's job, but not overjoyed. You haven't decided whether to recommend renewal or to seek the services of another audit company at this time.

I'd like you to write a letter to the CPA firm's partner in charge of your company's audit. I'd like you to describe an accounting issue that your company is experiencing. It could be any type of problem – directly or indirectly – covered in Intermediate Accounting I or II (or even Advanced Accounting). It could be for a for-profit company, a non-profit organization, or a state or municipal government.

Now it's time to switch roles. You work for a CPA firm as a senior audit manager. This audit engagement is in your hands. The controller's letter (above) has been sent to you by the engagement partner, and you have been instructed to draft the firm's official response. The partner's main instructions are to: 

(1) make the response look professional, 

(2) remember that the firm would like to keep this customer, 

(3) get the answer correct according to US GAAP (or IFRS) because that is how we do business, and 

(4) get the answer correct in case we are ever sued. Write a response to the client for the firm. You should conduct all of the research that you believe is required. (1-2 Page)

Answer rating: 100% (QA)

AnswerIf a covered members assets were held by a financial services com... View the full answer