Please help with the following problem. Provide at least 100 words in the solution.
Most business transactions result from "arm's length' dealing. When parties to a transaction are related, the objectivity expected in unrelated bargaining may be lost. Any loss of objectivity may require reporting in the financial statements for users to be able to properly evaluate the company's financial condition and results of operations.
Consequently, material related party transactions must be disclosed. SFAS 57, Related Party Disclosures, identifies the requirements.
Required: Design an audit program to reveal related party transactions© BrainMass Inc. brainmass.com March 4, 2021, 7:50 pm ad1c9bdddf
Prepare a list of related parties using the following procedures:
1. Inquiry of predecessor auditor
2. Review of prior years' workpapers
3. Inquiry of management for names and material transactions ...
The solution presents an audit program designed to reveal related parties and their material transactions in company records. The explanation is given in 118 words.