\fEP 4.13 Audit Scope LimitationsClient Imposed. .3\" Required.- 5. What alternative procedures can an auditor perform to determine whether the accounts receivable balance is not materially misstated when client management will not permit audit conrmations to be used? I}. What are the reporting implications if alternative procedures can be performed and provide sufcient audit evidence in situation (a)? c. What are the reporting implications ifalternative procedures cannot be used to satisfy audit eVidence requirements in situation {a}? EP 4-17 Going-Concern Issue. LOG PA is the auditor of TC Inc. TC's revenues and profitability have decreased in each of the past three years and, as of this year-end, 20X3, its retained earnings will fall into a deficit balance. TC's long-term debt comes due in 20X4, and its management is currently renegotiating the repayment date and terms with its Page 138 bondholders. According to PA's discussions with management, the renegotiation is not going well and there is a significant risk that the bondholders will put TC into receivership and liquidate its assets. TC's CFO has provided draft 20X3 financial statements to PA that are prepared in accordance with GAAP. Required: a. Discuss the audit reporting implications of the preceding situation. b. Assume that the long-term debt repayment date was not until 20X5. Would your response differ?EP 5.3 Auditing an Accounting Estimate. m Suppose that management estimated the lower of cost and net realizable value of some obsolete inventory at $99,000 and wrote it down from $120000. recognizing a loss of {521.000. The auditor: obtained the following information: The inventory in question could be sold for an amount between $78.000 and m 392.000. The costs of advertising and shipping could range from $5.000 to 31000. Required.- a. Would you propose an audit adjustment to the management estimate? Write the appropriate accounting entry. .5. If management's estimate of inventory market [lower than cost) had been 550.000. would you propose an audit adjustment? Write the appropriate at counting entry