Reference no: EM132945058

Question - You are a public accountant at Cartman, Griffin, & Simpson LLP. On November 20, 2020, an audit partner from your firm has sent you an email summarizing the business of one of your clients - Avalon Holdings Ltd. (AHL) as shown on page 2.

-At a high level, list at least two inherent risks and at least two control risks affecting AHL as well as comment on theoverall control environment of AHL.

-Evaluate at least two factors that have changed over the prior year that impact the audit risk assessment for the current year. Indicate how these factors influence audit risk and draw a conclusion on overall audit risk.

-Identify five control weaknesses within AHL's order receipt, processing, and shipping process as well as specify the corresponding control objectives impacted.

-List the two primary audit assertions, your audit team should be concerned with regards to the accounts receivable of AHL. Why?

-Design a substantive audit program with at least two audit procedures over the advertising revenue recognition process.

-Design a test of controls audit program with at least three audit procedures over the new line of credit. For each audit procedure in (5) and (6),

-Write the control test along with the corresponding control objective

-Indicate the financial statement assertion addressed by the control test

-Describe the test of control by specifying the population used to select sample, extent of sample selection along with a rationale, relevant audit evidence gathering technique to be applied, and expected results.