• 1)Why were the predecessor auditors so concerned about controls over the investment income and contributions (and not so concerned about controls over the State funding)?

• 2)What alternativesdoyouhavewithrespecttotherepresentationletter?

• 3) What will you do?

Suggested References:

• AU-C315, ?Understanding the Entity and Its Environment and Assessing Risks of Material Misstatement.? esp. 13 et seq.
• AU-C330, ?Performing Audit Procedures in Response to Assessed Risks and Evaluating the Audit Evidence Obtained.? esp. s 5 - 11, A21 ?A44
• AU-C265, ?Communicating Internal Control Related Matters.?
• AU-C580, ?Written Representations.? esp. 25 et seq.