Required: Analyze a subsequent events for the four events listed below

ColAlta Pipeline An External Auditing Simulation ColAlta Pipeline, Ltd. Subsequent Events Following are a series of independent situations (i.e. do not let any one situation affect your view of the other situations). For each situation below, descibe what action you believe you as the auditor should take in the given situation, and provide an explanation as to why you believe this is the correct course of action. Support your response with reference to the auditing standards where appropriate. For the purpose of this activity, recall that the financial statements are dated December 31, 2017. Assume that the audit report will be dated February 15, 2018. Event Date of the event February 1, 2018 A landowner who operates a farm through which the pipeline runs was digging a hole on his property and accidentally damaged part of the pipeline. ColAlta has filed a lawsuit claiming damages in the amount of $80,000 January 2, 2018 February 3, 2018 When cleaning up her work space one day, one of the Accounts Receivable / Billing clerks discovered an invoice dated December 27, in the amount of $800 to 21 Century Energy, Inc. This invoice had been printed but fell down behind the clerk's desk before being mailed to the customer One of the accounts receivable clerks resigned on this date. As he cleaned out his desk, he spoke quite loudly and angrily about how ColAlta used fraudulent financial reporting practices. Another clerk informed you that the clerk who resigned had been very unhappy for some time. The state government of Idaho issued a draft paper proposing a 9% increase in state property taxes, which would include the portion of the pipeline running through that state. January 1, 2018