1. In the Pinnacle case, you performed preliminary analytical procedures are part of audit planning. Briefly describe one of those procedures, why it was performed, and what the results told you. 2. As part of the Pinnacle case, you were required to assess acceptable audit risk as low, moderate or high. Explain what "acceptable audit risk" means. Why is it assessed during audit planning and what is it used for? 3. In the Pinnacle case, you prepared a control risk matrix for acquisitions and for cash disbursements, identifying key controls and control deficiencies. Then, you assessed control risk as low, moderate or high. Explain what "control risk" means. Why is it assessed and what is it used for? What are the implications for the audit if control risk is assessed as "high"? 4. In part VII of the Pinnacle case, you examined vendor confirmations for accounts payable. Some of the vendor confirmations did not agree with Pinnacle's records. Did this always indicate a financial statement misstatement? Why or why not? If there is a material misstatement that management will not correct, what type of audit opinion will be issued. 5. Why would Pinnacle need an audit? What is the importance of auditor independence? 6. Who issues audit standards for auditors of publicly traded companies? 7. Who issues audit standards for auditors of non-public companies? 8. What is the role of the SEC? 9. Describe the difference between a qualified and an unqualified audit opinion. 10. What is the difference between an audit, a review and a compilation and what is the level of assurance for each?