Draft income statement prepared by management

Reference no: EM132594206

Question: Water Your World (WYW) is a medium-sized, private manufacturing company located near Harrow, Ontario. WYW has a June 30 year end. The chief financial officer (CFO) felt that WYW has outgrown its previous audit firm Jacob and Jacob and asked your firm, Bartle & James (B&J), to perform the annual audit.

It is now August 2, 2020. B&J has performed the necessary client acceptance procedures and is currently working on the year-end audit of WYW. However, Jason Bourne, the senior on the engagement has met his life partner and suddenly left the country to be with her in Bali. He is not available and will be unable to complete the file. You, Justin Case, CPA, have been asked to take over the senior role on the audit. The following information has been provided to help you familiarize yourself with the client:

(Exhibit I) information on WYW, (Exhibit II) a draft income statement prepared by management in accordance with accounting standards for private enterprises (ASPE), (Exhibit III) notes from your firm's meetings with management and the board chair, and (Exhibit IV) excerpts from the current-year audit file.

Required:
The following week, the audit partner on the file calls you into her office and says, "Now that you've had the audit file for a week, can you let me know what financial reporting issues you have found? I want to know if there are any updates needed to our approach in particular our audit plan, any materiality considerations, and what audit procedures are outstanding. In addition, the board chair is wondering what our management letter is likely to contain, what internal control improvements can be made, and if there are any suggestions to the board for improving their oversight."

Attachment:- Water Your World.rar

Reference no: EM132594206

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