Beginning the Audit Report Apollo Shoes

November 17, 2014

Larry Lancaster

Chairman, President and CEO

Apollo Shoes Inc.

1850 North Apache Blvd

Shoetown, Maine 85925

Dear Mr. Lancaster,

This letter explains the understanding of the arrangements for the objectives and terms of the upcoming auditing procedure for Apollo Shoes, Inc. REDW Auditing and Assurance Services is pleased to continue to work with your company and perform the audit of the year ending on December 31, 2014. The REDW staff members would like to confirm the audit objectives, terms, limitations, and nature of the services provided for this engagement. The highlight of our services will cover auditing financial statements that include the income statement, balance sheets, statement of retained earnings, and the statement of cash flows.

The financial audits will make sure that financial statements are presented according to General Accepted Accounting Principles (GAAP). Since investors, creditors, managers, and government agencies use these statements, it is very important for the auditor to ensure all financial statements conform to GAAP (Arens, Elder, & Beasley, 2006). The audit team will also examine and measure the operational performance by studying specific parts of the organization and evaluate the effectiveness and efficiency of operation activities on the financial statements. Our firm will gladly provide reasonable, but not absolute, assurance services that are performed by professional auditors to enhance the credibility of internal controls, IT systems, financial statements, compliance with regulation and human resource practices.

Our auditors will express conclusion reports that will enhance the confidence of users, creditors, bankers, and management. One of the assurance services provided by REDW is attestation services. “An attestation service is a type of assurance service in which the CPA firm issues a report about the reliability of an assertion that is made by another party. Attestation services...