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Auditing Procedures and Subsequent Events

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Green, CPA, is auditing the financial statements of Taylor Corporation for the year ended December 31, 20x1. Green planned to complete the fieldwork and sign the auditor's report about May 10, 20x2. Green is concerned about events and transactions occurring after December 31, 20x1, that may affect the 20x1 financial statements.

Required

a) What are the general types of subsequent events that require Green's consideration and evaluation?

b) What are the auditing procedures Green should consider performing to gather evidence concerning subsequent events?

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Solution Summary

This solution examines and evaluates the types subsequent events and auditing procedures that Green CPA should use while auditing Taylor Corporation.

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Subsequent event.

Green, CPA, is auditing the financial statements of Taylor Corporation for the year ended December 31, 20x1. Green planned to complete the fieldwork and sign the auditor's report about May 10, 20x2. Green is concerned about events and transactions occurring after December 31, 20x1, that may affect the 20x1 financial statements.

Required

a) What are the general types of subsequent events that require Green's consideration and evaluation?
One general type of subsequent events are those that give additional evidence with respect to conditions that prevailed on the December 31, 20x1 and effect the estimates used by the management in the evaluation of the estimates. Also the ...

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