Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Your engagement team is in the process of planning your firm's audit of Xray Corporation (the Company) as of and for the year ended December
Your engagement team is in the process of planning your firm's audit of Xray Corporation (the Company) as of and for the year ended December 31, 2023. The Company's long-time CFO has recently taken a medical leave of absence and the CFO oversite of the accounting function is now being performed by an accountant from a local temp agency. Your conversations with the Company's owner suggest that she is very concerned about the absence of the regular CFO. The owner's concern, in part, is based upon feedback that she is getting from her accounting staff about the temp's accounting knowledge and their feed back that the Company's inventory accounting is not undergoing the review and testing of the account balances that was performed by the regular CFO on a regular basis. Specifically, the owner is being told that cycle counts of inventory balances as a test of the accuracy of the perpetual records has not been performed in 10 months and that the normal year-end review of inventory for obsolescence has not been performed since the regular CFO went out on medical leave. Required By reference to the professional standards, compare the preceding issues (a temporary CFO and lack of
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started