Istiklal Company imports devices for heating water in swimming pools from a Turkish company, and there is no other source from which it can be imported. The Istiklal Company has contracted with local companies to sell and distribute the quantities it imports, and because the Istiklal Company is a new company, its budget showed total assets of 1.500,000 dinars, including 200,000 dinars in debt related to uncollected shares. Also, the biggest asset Represents development costs incurred and capitalized in the amount of 500,000 dinars. The company intends to issue ordinary shares to the public at a value of one million dinars, as the number of new shares represents 67% of the total number of shares after the issuance. There are two of the main administrators in the company, Asaad and Amjad, and they were working in the management of Al-Hurriya Company. As for Amjad, he was brought to trial and was convicted of misusing the funds of the Freedom Company.

He works in the current company (Istiqlal Company). Also, the company they were working with previously (Al-Hurriya Company) had filed a lawsuit against it by the Stock Exchange because of unrealistically inflating the net income, and Amjad was at that time its CEO. Al-Hurriya Company is the basis for Al-Istiqlal Company, as Al-Istiqlal Company has replaced Al-Hurriya Company. There are many institutions studying the feasibility of using water heaters, and most of these institutions are larger and financially stronger than Al-Istiqlal. Noting that Al-Istiqlal Company did not obtain any patent right to protect it from competitors. 

Required: 

1- Describe the steps that the auditor follows in order to take a decision to accept the new audit assignment. Potential risks that could affect the acceptance of the audit assignment of the Independence Company. 

2- what she 3- What are the accounting and auditing problems that are related to this case? 

4- What other information do you feel you need as an auditor to decide whether or not to accept this assignment? 

5- Do you think that this task should be accepted or rejected? And why?. 

6- What is the impact of this condition on each of the audit acceptable risks, the inherent risks, the control risks, and the risk planned discovery

Answer rating: 100% (QA)

1 procedures that an auditor must follow in order to make a decision on whether or not to accept the ... View the full answer