You have been asked to audit the revenue from member-ship fees for the Orange County Master Gardeners Club. Your spouse is a member of the club.
a. What questions would you ask the club treasurer to verify the revenue?
b. Let’s assume that we have the following information: the club had approximately 200 members at the end of last year. Each year the club loses 15% of its members and gains 20% in new members. The dues are $50 per year, but members over 65 have a life-time membership where they do not pay dues. Approximately 20% of our membership is over 65 at any time. Describe some analytical procedures that you might use to determine that the membership revenue reported on the club’s financial statements is not materially misstated.
c. Assume that membership revenue reported by the treasurer is $6,000. What would you conclude about the revenue?