$16-8$ Auditing Noncurrent Investments

Harold Brodkey is engaged in the audit of Longview Corporation$$s financial statements for the year ended December $31,2007,$ and is about to begin auditing noncurrent investment securities$.$ Longview$$s records indicate the company owns various bearer bonds, as well as

$25$ percent of the outstanding common stock of Industrial National Inc. Brodkey is satisfied with evidence supporting the presumption that Longview exercises significant influence over Industrial National. The various securities are at two locations:

Recently acquired securities are in the company$$s safe in the custody of the treasurer.

$$ All other securities are in the company$$s bank safe$-$deposit box.

$$ All the securities in Longview$$s portfolio are actively traded in a broad market.

Required:

$1.$ Assuming that control procedures for securities may be relied on in assessing control risk below the maximum, what are the objectives of the audit of these noncurrent invesiment securities$?$

$2.$ What audit procedures should Brodkey perform to audit Longview$$s noncurrent investment securities$?$