QUESTIONS
1.What are the key procedures you would perform regarding clientacceptance? Where would you get the data? Use the format by listingunder each:
PROCEDURE DATA
2. Williams Gens, an audit partner with your firm, has selectedyou to prepare a memo regarding the acceptance of CBA as an auditclient. The audit will, if accepted, occur during the firms’s slowseason when there is excess employee capacity.
Consider the following category:
1. Thepredecessor auditor explained that, due to disagreements on theapplication of GAAP, CBA Inc. chose to engage another auditingfirm. The auditor, fearing Litigation would not specify thespecific area of disagreement.
2. CBAregularly pays its accounts payable 30-60 days late.
3. Management turnover has been excessive.
4. CBAis in a highly regulated, competitive industry.
5. Account Receivable turnover is 43 days.
Requirement for question 2:
What are the procedures that you would undertake for each of thecategory 1-5?
