Solution Manual Auditing Arens 144/23/2021
Over lunch, he is surprised when his friend James Foley asks him, Doesnt it bother you that your clients dont look forward to seeing their auditors each year Dave responded, Well, auditing is only one of several services we provide.Which one or ones does the auditor reduce by per- forming an audit.What are the information and established criteria for the audit of Jones Companys tax return by an internal revenue agent What are they for the audit of Jones Companys financial statements by a CPA firm.However, many competent accountants do not have an understanding of the auditing process.
Two competing banks have offered to replace Busch Corporations existing loan agreement with a new one. United National Bank has offered to loan Busch 4.5 million at a rate of 4.5 but requires Busch to provide financial statements that have been reviewed by a CPA firm. Busch Corporations controller approached a CPA firm and was given an estimated cost of 20,000 to perform a review and 45,000 to perform an audit. Explain why the interest rate for the loan that requires an audit report is lower than the interest rate for the other two loans. Indicate whether Busch should keep its existing loan, accept the offer from United National Bank, or accept the offer from First City Bank. A major part of its function is the testing of different brands of consumer products that are purchased on the open market and then the reporting of the results of the tests in Consumer Reports, a monthly publication. Examples of the types of products it tests are middle-sized automobiles, residential dehumidifiers, flat-screen TVs, and boys jeans. National has a loan of 325,000 outstanding to Regional Delivery Service, a company specializing in delivering products of all types on behalf of smaller companies. Nationals collateral on the loan consists of 25 small delivery trucks with an average original cost of 24,000. Solution Auditing Arens 14 Registration Information HeldHe therefore engages Samantha Altman, CPA, to count the trucks, using registration information held by Burrow. Burrow requests that Altman issue a report stating the following. The first senior plans to become an internal revenue agent because his primary interest is income taxes. He believes the background in tax auditing will provide him with better exposure to income taxes than will any other available career choice. The second senior has decided to go to work for a CPA firm for at least 5 years, possibly as a permanent career. She believes the variety of experience in auditing and related fields offers a better alternative than any other available choice. Solution Auditing Arens 14 Trial Company BecauseThe third senior has decided on a career in internal auditing with a large industrial company because of the many different aspects of the organization with which internal auditors become involved. The fourth senior plans to become an auditor for the GAO because she believes that this career will provide excellent experience in computer risk assessment techniques. The fifth senior plans to pursue some aspect of auditing as a career but has not decided on the type of organization to enter. He is especially interested in an opportunity to continue to grow professionally, but meaningful and interesting employment is also a consideration.
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