I foremost wanted to thank you for complimenting me on my recent publicity ; I look frontward to working with you on the new Apollo Shoes battle. I have read all the information you sent me about Apollo Shoes to derive a better apprehension of the company. and I feel like I have a steadfast appreciation of the company construction and environment. After reexamining the company’s last three board of managers meetings. I determined what expertness would be necessary to transport out the audit on Apollo Shoes. If you can delegate these staff to our audit squad. the productiveness and effectivity of the audit will increase significantly. The first staff member that would be greatly helpful to our audit squad would be an information engineering specializer. In the board meeting held on June 30. the board authorized up to $ 1. 2 million for the purchase and installing of a new information system. However. to fund the purchase and pay other disbursals. the board authorized a draw of over $ 44 million. which seems really inordinate.
Having an IT specializer will assist us find the entire cost of put ining a new information system and convey visible radiation to why the board drew over $ 44 million to fund the purchase. Another staff member that would be helpful to our audit squad would be a belongings. works. and equipment specializer. Despite authorising the purchase of equipment numbering $ 1. 3 million in January of 2014. the equipment was still non put up during the January 2015 board meeting. A belongings. works. and equipment specializer could assist us find the accounting deductions of buying the equipment in 2014 and still non holding it set up in 2015. every bit far as depreciation and cost acknowledgment are concerned. Quite perchance the most of import staff member that we will necessitate on our audit squad is a attorney or legal expert. for a assortment of different state of affairss.
The first and most blazing state of affairs that will necessitate to be addressed is the board progressing $ 1. 250. 000 straight to Mr. Lancaster to cover personal legal disbursals for his secretary. Recording it in other receivables alternatively of employee progresss and pulling a cheque straight to Mr. Lancaster set off a ruddy flag for us and we would wish a legal expert to look farther into the state of affairs. Another state of affairs that will necessitate the attending of a legal expert is a category action suit that was brought against Apollo Shoes for gross carelessness and misdemeanor of guarantee for $ 12. 000. 000. A legal expert could assist us find the chance that Apollo Shoes will lose the instance.
The company does non hold insurance to cover these types of actions. so losing this instance could hold immense deductions on their hard currency balances. One of the last state of affairss we would wish the legal expert to look into was the retroactive declaration of dividends in January of 2015. At that board meeting. they approve to declare the dividends in the old twelvemonth. which we are non certain is allowed. so a legal expert could give us better penetration into the state of affairs. These three specializers seem to be the most necessary staff members after reexamining all of the company’s board meetings. and they will be of significant aid if you could delegate them to our audit squad. If I determine that I need any extra staff support in the hereafter. I will allow you cognize throughout the audit procedure.