Question

Bravo Bags is a luggage retailer that operates out of a shopping mall. As required by the landlord, Bravo Bags has hired Brad Pope, CPA, to provide a report to the landlord indicating whether Bravo Bags has met the requirements of its lease agreement in terms of reporting the store’s sales information.

Which of the following are true for Bravo Bags? (Multiple answers)

1) No assurance can be provided because the requirements of an assurance engagement are not met.

2) Remoteness is why the landlord may be requesting a report on the store sales information.

3) The required parties for an assurance engagement are met—the landlord is the intended user, the auditor is the practitioner, and Bravo Bags is the responsible party.

4) An auditor could not perform this engagement as they would not have the expertise.

5) The auditor could issue a Notice to Reader and meet the landlord’s objectives.

6) This is not a financial statement audit, and only financial statements can be audited.

7) The landlord would like to enhance the reliability of the sales figures reported.

Answer 1

The correct answers are

3.The required parties for an assurance engagement are met—the landlord is the intended user, the auditor is the practitioner, and Bravo Bags is the responsible party.

7) The landlord would like to enhance the reliability of the sales figures reported.

Answer 2

The correct answer is

The required parties for an assurance engagement are met—the landlord is the intended user, the auditor is the practitioner, and Bravo Bags is the responsible party.