How should jane respond to the claim

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Problem 1: Jane Lynch performed an audit on the Muddle Company and issued an unqualified opinion. Jane performed the audit with due professional care and in accordance with generally accepted auditing standards. Two months after the report is issued, Jane discovers on the news that the CEO of Muddle, Jimmy James, had been stealing small amounts of inventory. The amount, however, is immaterial compared to the overall inventory of the corporation. Jane soon receives a call from Muddle's CFO, Mark Smith. Mark wants Jane to refund her audit fees. Mark thinks Jane did not properly perform the audit, as she did not discover this fraud. Further, he feels that now Muddle's financial statements are not fairly stated because of Jane. How should Jane respond to this claim?

Reference no: EM132774486

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