Assignment
How Would You Write the Audit Opinion and Internal Control Report on the following:
As an auditor, what would your conclusions/recommendations be? What would you state in your audit report?
Materiality is $120 million
1. Cash reconciliations not performed until 5 months late, but were caught up by year-end. At one point in time, the unreconciled balances totaled $1.4 billion.
Financial statements had some minor differences before being provided to the auditors
Financial statements were fairly stated at year-end
Entity adopted new SFFAS this year that significantly changed the reporting structure
2. Audit could not be completed in time due to financial statement preparation weaknesses.
Large numbers of disbursements without supporting documentation (approximately $275 million)
3. Major problems after implementing a new financial accounting system
Problems with locating supporting contract information
Financial statements were fairly stated after material auditor adjustments.