Part II: Substantive Analytical Procedures

Case Facts

At your request, the two first-year auditors compiled and confirmed the following disaggregated information regarding rental activities at LSS for the 20X8 fiscal year:

	Number of Small Units	Number of Large Units	Number of Commercial Units
West	60,522	27,130	8,347
Southwest	50,435	22,609	6,597
Midwest	37,826	16,957	5,217
South	63,043	28,261	8,696
Northeast	78,174	35,043	10,783

	Avg. Small Unit Annual Revenue per Square Foot	Avg. Large Unit Annual Revenue per Square Foot	Avg. Commercial Unit Annual Revenue per Square Foot
West	$0.68	$0.62	$1.25
Southwest	$0.81	$0.74	$1.31
Midwest	$0.61	$0.57	$1.18
South	$0.83	$0.75	$1.32
Northeast	$2.02	$1.72	$2.72

	Avg. Small Unit Occupancy	Avg. Large Unit Occupancy	Avg. Business Unit Occupancy
West	92%	90%	96%
Southwest	87%	88%	94%
Midwest	81%	87%	91%
South	88%	89%	93%
Northeast	94%	91%	95%

Logan Self Storage Part II

1. Using this data, develop an updated expectation for the total rent revenue for LSS for the 2012 fiscal year.

2. Using your updated expectation from requirement #1, determine whether the reported rent revenue appears to be fairly stated.

3. What specific factors may have led to the difference between your first and second estimates?

4. What factors impact the level of disaggregation of data that would be required when performing substantive analytical procedures?

5. What other factors regarding the data should you consider when determining the level of reliance you can place on substantive analytical procedures?