A lawyer you know is working on a case for one of his clients who has commenced legal proceedings against an industrial company and its auditor in connection with the company's failure. The auditor, ironically, had precipitated the failure by refusing to issue an unqualified auditor's opin¬ ion on the most recent annual financial statements. The CA's professional judgment is being questioned, not because of this refusal and its consequences, but because the lawyer's client claims that the financial statements for prior years should not have received unqualified auditor's opinions.

The lawyer will be reviewing the audit files before the case goes to court. He will also have the opportunity to cross- examine the company's auditor in court.

The lawyer has come to you, Janet Brown, CA, for assis¬ tance in the preparation of his case. He has asked you to describe the general characteristics of good professional judgment and, in particular, the steps you would expect the CA to have taken to ensure that he was exercising good pro¬ fessional judgment in this situation.

Required

a. Assume the role of Janet Brown and draft a response to the lawyer.

b. What are the characteristics of working papers that should be present in the defendant CA's working papers?

(CICA adapted)