Apollo refused our obtain to speak with the predecessor auditors because of " litigation concerns. ” I have looked at the 8-K registered by Apollo and the auditors referenced inside the 10-K. I didn't affix a copy since it didn't declare much, just something about " incongruent goals, ” blah, blah, blah. Against my personal advice, Arnold decided to recognize the diamond anyway. Keep your eyes available!
The good news is that the predecessor auditors, Smith and Jones, CPAs, have got a good reputation, to help you use previous year's audited numbers from your 10-K. The bad news is the fact we don't have access to preceding year doing work papers. You will have to come up with applications for the substantive review procedures for each of the useful balance sheet areas (indicated with an asterisk (*) below). You can down load copies in the audit courses from AuditNet (www.auditnet.org) underneath " Auditors Sharing Examine Programs” or get them by an old auditing textbook. My own preference is usually to place the taxation programs at the beginning of each section. Label the sections the following:
GA series (GA-1, GA-2, etc . ) General and Administrative (Planning) ICC seriesRevenue/Collection Cycle Inner Control Evaluation ICD seriesPurchasing/Disbursements Internal Control Evaluation ICP seriesPayroll Inside Control Analysis
A seriesTrial Balance/Financial Statements/Adjustments/Footnotes B series*Cash Substantive Workpapers
C series*Accounts Receivable Hypostatic Workpapers
D series*Inventory Hypostatic Workpapers
Elizabeth series*Prepaids Hypostatic Workpapers
F series*Property, Plant and Products Substantive Workpapers I series*Other Assets Substantive Workpapers
L series*Current Liabilities Substantive Workpapers
N series*Notes Payable Substantive Workpapers
Queen series*Stockholders' Value Substantive Workpapers
R series*Revenue Substantive Workpapers
X series*Expenses Substantive Workpapers
Because we could so understaffed during busy season, you might have to carry out the bulk...