Prepare a written memo and make,… describing the key audit risks posed by your selected company.
- Begin your report with a historical overview of the company and its industry.
- Discuss the potentially problematic non-financial items that you identified for the assigned company such as, a management compensation scheme tied to
reported earnings, an upcoming merger, restrictive bond covenants, etc. - Present the results of analytical procedures you applied to your company’s financial data. Compute common-sized financial statements and key ratios for a
5-year period. Perform trend and comparative industry analysis. - Complete your presentation with a summary recommendation regarding whether the given company appears to be an acceptable audit client or alternatively, whether the company would pose an unacceptably high level of audit risk and/or
business risk for an audit firm.
along with a PowerPoint presentation required addressing points 1-4 above.
The format of the memo should be as outlined below;
purpose; xxxx
Background: Should contain responses to Item(s) #1, 3
Issue(s): Should contain responses to Item #2
Conclusion: Should contain responses to Item #4
Sample Solution