Part IV (10 percent) The following items represent a series of unrelated procedures that an accountant may consider performing in an engagement to review or compile the financial statements of a nonpublic entity, Procedure may apply to only one, both or neither type of engagement 1. The accountant should obtain an engagement letter, signed by both the client and accountant's firm 2. The accountant should be independent of the entity 3. The accountant should perform inquiries of the client's attorney 4. The accountant should obtain a management representation letter from the entity 5. The accountant should make inquiries about events subsequent to the date of the financial statements that have a material effect on the financial statements. 6. The accountant should perform analytical procedures designed to identify relationships that appear to be unusual. 1l Page Name: ACCT 4226381 Auditing Theory and Practice Date: Homework # 7 The accountant should obtain knowledge of the client's industry and its accounting practices The accountant should read the financial statement and notes to ensure free of obvious 7. 8. 9. 10. The accountant should evaluate the clients assess and as to whether there is substantial material errors The accountant should obtain and document an understanding of internal control double about the ability of the client to continue as a going concern for a reasonable period of time Instructions: Indicate which procedures are required to be performed on 1. An audit 2. A review engagement; 3. A compilation engagement, and 4. Preparation of the Financial Statements Review Compilation Preparation of Engagement Engagement Financial Statements