You are a partner in the Denver office of a national public accounting firm. During the audit of one of your clients, you learn that this client is negotiating to sell some of its unproved oil and gas properties to a large investment company, which is an audit client of your New York office. Your client acquired these properties several years ago at a cost of $15 million. The company drilled several exploratory wells, but found no developable resources. Last year, you and your client agreed that the value of these unproved properties had been impaired as defined in paragraph 28 of Financial Accounting Standards Board (FASB) 19. The company wrote the carrying value of the properties down to an estimated realizable value of $9 million and recognized a $6 million loss. You concurred with this treatment and issued an unqualified auditors report on the companys financial statements. You are amazed to learn that the sales price for these properties being discussed by your client and the investment company is $42 million. You cannot understand why the investment company would pay such a high price and you wonder what representations your client may have made to the investment company concerning these properties. The management of your client company declines to discuss the details of the negotiations with you, calling them quite delicate and correctly pointing out that the future sale of these properties will not affect the financial statements currently under audit.