AUDITING PRACTICE QUESTIONS:

PRACTICAL AUDIT SHORT CASES

Please answer a-b

You have been engaged and you happily accepted to provide audit services to ABC Corporation, an S Corporation Company. The Company has in its balance sheet as cash, the following: Cash Equivalents $ 1,500,000.00 ii. Cash in three Bank accounts of: a. Chase Morgan $ 2,500,000 b. Regions 5,000,000 c. American Bank . 900,000 Total Bank Account balances 8,400,000.00 Total of Cash and Cash Equivalents 9,900,000.00 Required: a. Outline the necessary steps you must take to gather sufficient evidence to convince you that the total cash and cash equivalents is in deed, $9,900,000. b. What amount of evidence in quantity and quality will convince you that your audit risk is very small? Be brief and to the point