Essay about ACC 546 Engagement Letter

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Anderson, Olds, and Watershed
Denver, Littleton 80126

Mr. Larry Lancaster, President February 3, 2014
Apollo Shoes, Inc.
1234 Asbury Pl
Denver, Colorado 80123

Dear Mr. Lancaster,

This letter will confirm the understanding of the measures that will be taken by Anderson, Olds, and Watershed (herein after known as AOW) to perform the audit for Apollo Shoes, Inc., for the year ending December 31, 2007. This audit will review the financial statements with the purpose of issuing an option on the fairness of the statements. This audit will take into consideration the financial position of Apollo Shoes, Inc. and operations, transactions and cash flows to ensure that all laws and regulations are followed as they pertain to Generally Accepted Accounting Principles. The audit will begin with the collection of relative data and a review of the financial statements. After reviewing the financial statements and relative data it will be wise to perform a risk assessment and to devise an audit plan. The audit will be performed following accepted auditing principles that are generally accepted in the United States. Following these principles requires that a reasonable assurance, not an absolute assurance, be obtained that the financial statements do not contain any material misstatements caused by error or with the intent to commit fraud. Because only a reasonable assurance is required there may be material misstatements that are not detected during the audit. Audits are not designed to uncover any error or fraud that is considered immaterial. If our opinions on the completed audit are less than unqualified, we will contact you in advance to discuss the reasons in full. Professional judgment will be used to determine which generally accepted auditing standards are applicable to the current audit. Management has a duty to protect the financial position of the company. Their responsibilities include, but are not limited to, implementing and maintaining internal controls, including monitoring ongoing activities; selection and application of accounting principles; accurate presentation of all financial statements consistent with U.S. generally accepted accounting principles.
Management must make available all financial records and relevant data to AOW for review of accuracy and completeness of information. Management is responsible for correcting any material misstatements and confirming the effects of any uncorrected misstatements.
Management is responsible for the design and implementation of procedures and controls to prevent and detect fraud, and for informing AOW about all known or suspected fraud or illegal acts. Management has a duty to ensure company compliance of applicable laws and regulations. Management is obliged to take corrective action audit recommendations. Audit Procedures—The audit will examine evidence supporting the financial statements, including amounts and disclosures. To obtain a reasonable assurance, AOW will determine which…