Predecessor auditor prior to accepting the engagement

Assignment Help Financial Accounting

Reference no: EM13747726

The audit committee of the board of directors of Rebel Corporation asked Tish & Field, CPAs, to audit Rebel's financial statements for the year ended December 31, 2013. Tish & Field explained the need to make an inquiry of the predecessor auditor and requested permission to do so. Rebel's management agreed and authorized the predecessor auditor to respond fully to Tish & Field's inquiries.

Required:

a. What information should Tish & Field obtain during its inquiry of the predecessor auditor prior to accepting the engagement?

b. What additional audit procedures should Tish & Field perform in evaluating Rebel as a potential client?

c. After a satisfactory communication with the predecessor auditor, Tish & Field drafted an engagement letter that was mailed to the audit committee of the board of directors of Rebel Corporation. The engagement letter clearly set forth the arrangements concerning the involvement of the predecessor auditor and other matters. What matters would Tish & Field generally have included in the engagement letter?

Reference no: EM13747726

Questions Cloud

Summarize selling-collection activities for reporting period : For each of the three independent situations below, prepare journal entries that summarize the selling and collection activities for the reporting period in order to determine the amount of cash received from customers and to explain the change in ea..

Calculate each of the amounts for peach computers : The income statement and a schedule reconciling cash flows from operating activities to net income are provided below ($ in 000s) for Peach Computers. Calculate each of the following amounts for Peach Computers:

Conversion-personal use to business use : Alice starts a taxi service and decides to use her personal car as the first taxi in her new business. the car will be used solely for business purposes. The car had an original cost of $20,000 and fair market value at the date of conversion to busin..

Determine if an impairment loss should be recognized : Mueller Company purchased equipment 8 years ago for $1,000,000. The equipment has been depreciated using the straight-line method with a 20-year useful life and 10% residual value. Determine if an impairment loss should be recognized

Predecessor auditor prior to accepting the engagement : What information should Tish & Field obtain during its inquiry of the predecessor auditor prior to accepting the engagement? What additional audit procedures should Tish & Field perform in evaluating Rebel as a potential client?

Revenue-cost and sales data for the two products : Honolulu Novelties , Inc. makes two products, Hawaiian Fantasy and Tahitan Joy. Their revenue, cost, and sales data for the two products in 2013 follows : The company has developed a new product called the Samoan Delight. Assume that the company coul..

Weighted-average accumulated expenditures : On March 1, Felt Co. began construction of a small building. Payments of $120,000 were made monthly for three months beginning March 1. The building was completed and ready for occupancy on June 1. In determining the amount of interest cost to be cap..

Previously used the equipment in his sole proprietorship : Liz and John formed the equal LJ Partnership on January 1 of the current year. Liz contributed $80,000 of cash and land with a fair market value of $90,000 and an adjusted basis of $75,000. John contributed equipment with a fair market value of $170,..

The equal el partnership : Emma and Laine form the equal EL Partnership. Emma contributes cash of $100,000. Laine contributes property with an adjusted basis of $40,000 and a fair market value of $100,000. What is Emma's basis in her partnership interest? What is Laine's basis..

User Account

All Pages