This week focuses on the relationship between audit planning, the industry, and obtaining or retaining of the engagement. Auditors are required to exercise due diligence before accepting an engagement. The termengagement, when used in relation to an audit, signifies a contractual agreement between an audit firm and a business entity. The termsobtainorretainrelate to whether a new engagement will begin between the two entities or if the engagement is a continuing of a previous relationship.

Audits are like vacations-the more planning you put into it, the better the outcome. Therefore, planning is the most important part of every audit.The completion of the audit is time-sensitive; therefore, placing emphasis on planning ensures that an auditor's time is used wisely. If an audit firm is to make a profit, planning will help keep activities within the contract rate.

Select one of the following industries:

Clothing manufacturing

Pharmaceuticals

Food distributor

Then, search the Internet for a publicly-traded company in one of these categories. Locate the most recently published financial statement, and then complete the following:

Provide an overview of the industry, the company, and identify primary competitors.

Use the current state of the industry to identify the key concerns you would have if your firm were to enter into an engagement with this company.

Complete the assignment with an explanation of the critical items you would include in the audit plan