Letter of Services and Assurances

Letter of Services and Assurances

ACC/546

08-12-2013

To: Larry Lancaster

President, Chairman and CEO

Apollo Shoes, Inc.

Mr. Lancaster,

Thank you for taking the time to speak with Arnold Anderson, Darlene Wardlaw, and me last week. I understand from our conversation that you recently parted ways with your former auditing firm as a result of mutually incongruent goals. I appreciate your interest in Anderson, Olds, and Watershed (AOW) and want to explain a bit more about our services and other assurances my firm has to offer.

The Sarbanes-Oxley Act of 2002 requires auditors to verify to the efficiency of internal controls and financial reporting process, allowing external stakeholders to have assurance that the financial statements of your company are fairly represented in accordance with generally accepted accounting principles (GAAP). Not only can an audit of financial statements help increase investment in an organization, it can decrease the cost of capital and help to identify fraudulent activity within.

Your company may consider doing a review of historical financial statements. Although it is similar to an audit, it is less invasive and results in a lower level of assurance. However, this type of review is often sufficient to meet the needs of external stakeholders who bare interest in your company.

An operational audit will help us to obtain and evaluate evidence about the efficiency and effectiveness of your company’s operating activities in relation to specified objectives (Arens, Elder & Beasley, 2006).

As transactions and information are shared online and in real time, businesspeople demand even greater assurances about information, transactions, and the security protection (Arens, Elder & Beasley, 2006). We have two different types of services to help provide assurance of these functions: Web Trust services and SysTrust services.

WebTrust is an attestation service, and the WebTrust seal is a symbolic...