ACC 821 Lecture 4: Ryerson winter 2016 Advanced Auditing Week 4 -Solution to practise case-RGI
22 Feb 2016
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Engagement risk is high this year due to the following risk factors: ( note: should comment whether the risk is at the f/s level or the account/ assertion level) Rgi is planning on approaching the bank next year about the possibility of borrowing some funds. The bank will be relying on the audited f/s for 2013. Management integrity-tony recommends the accounting policies see revenue recognition re: membership ( key point) There is a lack of management experience relating to the igs as nether tony nor the store mangers have any experience with inline retailing. As a result there is a risk of customer dissatisfaction and ultimately loss of customers. Rgi"s operating name is a well respected name that is known for service and quality. There is a risk that if the igs operation fails or customer service is poor, that the russo"s name and reputation will suffer, negatively impacting the existing operation. ( key pont)
