Below is a transcript of a video conference call between Joe, the audit partner and Leslie, the audit manager.
JA: Leslie. I just got off another video call with Avis. She gave  me an update on Hillsburg’s response to COVID-19.
LN: And?
JA: Hillsburg decided that everyone who works in administrative positions will work from home. This includes the whole accounting department. Their head office building has been temporarily closed. There is some skeleton staff in the warehouse.
LN: Did Avis say when they might return back to the office?
JA: They don’t have a date in mind. Avis said that she expects her accounting staff to be working from home for at least the next six months. She also had to temporarily lay-off two of her accounting staff. Everyone is feeling the pinch so Hillsburg is trying to reduce its headcount to the bare minimum so it can conserve its cash.
LN: Who was laid-off?

JA: Hold on, let me take a look, I have the names written down here. Here it is . . . John from accounts payable.
FN: Oh, John. He was responsible for doing the monthly reconciliation of vendors’ statements with what’s in the accounts payable subledger. Who is going to do that now?
JA: I don’t think anyone. Avis said that they will just do the bare minimum and what’s necessary.
FA: Who else?
JA: Jasvinder.
FN: Oh no, poor guy. He was so happy to finally land his first job in Canada, and now this. So, with Jasvinder gone, it looks like Hillsburg will now only have one person looking after everything in payables.
JA: Yup, there goes all the segregation of duty controls that Avis was so happy with.

REQUIRED
1. Based upon Hillburg’s response to COVID-19, should Joe adjust the overall audit strategy for the Hillburg audit? Explain what adjustments the audit team should make to the audit approach to Hillsburg’s acquisition and payment cycle. Support your answer.
2. All of Hillsburg’s accounting staff will be working from home for the foreseeable future, and Hillsburg’s head office is now closed. What challenges do you think this might pose for the audit team when they are executing their audit procedures? How can they overcome some of the challenges you identified?