Auditing Introduction Letter

The purpose of this letter is to introduce the accounting firm of Edronibug and to explain the auditing and assurance services we can offer to Apollo Shoes and the benefit of each service. I will also explain my role in providing these auditing and assurance services and provide a description of the requirements for meeting the professional standards for the assurance services offered to Apollo Shoes.

Auditing and Assurance Services

According to Arens, Elder and Beasley, “auditing is the accumulation and evaluation of evidence about information to determine and report on the degree of correspondence between the information and established criteria.” The purpose of an audit is to provide assurance that the subject matter being audited is free from material misstatement. Any subject matter can be audited. An audit should be performed by a competent and independent person. Assurance services are similar to an audit but tend to be more customized. Edronibug is considered as an independent firm and is able to assist Apollo Shoes with these types of services. Edronibug offers three types of audit services which are compliance audits, financial statement audits and operational audits.

A compliance audit would be conducted to determine whether Apollo Shoes is following procedures, rules and regulations that are set by a higher authority. One example of this type of audit is to confirm whether Apollo Shoes is following the terms of a debt covenant set by the financial institution that holds the debt of the company. A compliance audit may be completed to determine if the accounting department is following the procedures prescribed by the controller or the CFO of the company. The results of a compliance audit are typically reported to management or an internal board rather than an outside agency. This type of audit would be beneficial to know whether the employees are following the procedures. If the procedures are not being followed, Edronibug will be able to determine...