Auditing

Apollo Shoes

Auditing Introduction Letter

Ardyth Smith

Instructor: Deborah Fitzgerald Thomas

July 4, 2011

University of Phoenix

Auditing Introduction Letter

A Smith & Company CPA Firm

July 4, 2011

Apollo Shoes, Inc.

Management Team

RE: Beginning the Audit

Dear Mr. Jones:

I would like to give you the plan for the audit engagement. First of all, I will gain a complete understanding of the control structure, sales, shipping, information system, transactions and records. I will document my understanding of the flow of work through my checklist, create a flow chart, and write a narrative of my findings. Next will be the initial assessment of control risk I will be able to be identify relevant controls and evaluate weaknesses. I will then set the level of control risk. The audit procedures will then be determined, the nature, timing and extent of fieldwork. The final step will be the final assessment which will be based on control tests of operation. This will be accomplished through test of controls, inquiry, observation, inspection and re-performance. This all is in relation to timing and the extent of evidence needed.

Evaluation of sufficient evidence and reassess internal control risk will be performed at this point. This is when the need for more evidence to be gathered will be determined. Also, if nothing further seems to be needed, the audit will continue.

If there is something that you are unsure if we can assist, please feel free to discuss it with our office and we will be happy to evaluate your needs and hopefully accommodate.

I look forward to meeting with you to discuss our future business relationship.

Sincerely,

Ardyth Smith