A. Pike Company has had an annual audit performed by the same firm of certified public accountants for many years. The financial statements and copies of the audit report are distributed to stockholders each year shortly after completion of the audit. Who is primarily responsible for the fairness of these financial statements? Explain. (10 marks)

B. The firm of Johns, Apple & co, CPAs, is the auditor of Alpha Corporation, a nonpublic company. The president of Alpha, Karen Lester, has been putting pressure on Sara, the audit partner, to accept a questionable accounting principle. She has even threatened to take steps to replace the CPA firm if he does not acquiesce. Does this situation impair the CPA firms independence? Explain your answer. (10 marks)

C. West & Co., CPA, completed an audit of Star Manufacturing Company and issued a standard audit report. What does this tell us about the extent of the auditing procedures included in the audit?