| | |Ann Inc.: Audit Risk Analysis | | | | | | | |Liberty University | |Audit Risk Analysis Project | |Acct 622 | |Professor John Kuhn |
Decision to accept or decline Ann Inc. as an Audit Client
For the reasons given below, I recommend that we accept Ann Inc. as an audit client. Ann Inc. has for many decades risen in stakeholders and customer satisfaction. The company name has grown in notoriety as has its stock. Ann Inc. employs approximately forty-five hundred employees in forty-seven states, four countries and online sales sites. The corporation leases 5.7 million square footage of property for their 980 plus stores. Ann Inc. has contracted with their current audit firm for the past fourteen years; Deloitte & Touche LLP. The corporation has a stable standing with the community for the past fifty years. There are no published regulatory actions against Ann Inc. or any of its directors. The addition of Ann Inc. to our firm will be a great asset for the both. Their strength and continued growth provides future retention with the firm. Brief History and Description of Ann Inc.
Ann Taylor dates back to 1954, when Robert Liebeskind opened his first shop. The name sake represented his father’s best-selling dress style. The store had its early beginnings in the town of New Haven, Connecticut. The clothing store offered classic, tailored designs for career women. Much of the historical details of the company depict its first two decades as catering to the Ivy League elite students. During the growth of the company, Mr. Liebeskind created fashions that would appeal to area college students, as well as, their mothers. Ann Taylor experienced management shifts that allowed for the creation of other cutting-edge, upscale designs that resembled the popular European designs that were gaining popularity in America. The company is served by a modest board of directors and lead by Chief Executive Officer, Kay Krill. As reported by the Fortune 500 standings and stock pricing performance, Ann Taylor Corporation equals its closest competitor in the industry. The company has celebrated over fifty years of financial growth that has expanded out of the quaint New England Township into larger market, such as, New York and Chicago to allow for a greater marketable advantage. During the fiscal year of 2008, Ann Taylor along with other retailers experienced a recession in the economy that was defined by low consumer confidence, rising unemployment levels and declining consumer spending. The company worked quickly to protect the health and position of the company to succeed in the long-term. The year brought the launch of a multi-year restructuring program, designed to reduce cost structure, optimize the stores portfolio, focus on inventory management,...
References: AICPA Audit and Accounting Practice Aid Series: Establishing and Maintaining a System of Quality Control for a CPA Firm’s Accounting and Auditing Practice. (2007). American Institute of Certified Public Accountants. Retrieved from: http://www.aicpa.org/InterestAreas/GovernmentalAuditQuality/Resources/DownloadableDocuments/System_of_Quality_Control_Practice_Aid.pdf
Ann Inc. (2012). ANN Inc. 2012 Annual Report. New York, New York. Retrieved from: http://investor.anninc.com/phoenix.zhtml?c=78167&p=irol-irhome
Colbert, J. L., Luehlfing, M. S. & Alderman, C. W. (2009). Auditing—engagement risk. The CPA Journal. Retrieved from: http://www.nysscpa.org/cpajournal/1996/mar96/depts/auditing.htm
Curan, C. (Jan 28 2002). New AnnTaylor lead must fashion turnaround. Crain’s New York Business. p 4. Retrieved from: http://catalog.hathitrust.org/Record/002609505
Funding Universe. AnnTaylor stores corporation history. Retrieved from: http://www.fundinguniverse.com/company-histories/anntaylor-stores-corporation-history/
Furman, P. (Mar. 25 1991). Fashionable AnnTaylor to sell stock. Crain’s New York Business. p 3, 34. Retrieved from: http://catalog.hathitrust.org/Record/002609505
Money (2013). Retrieved from: http://investing.money.msn.com/investments/key-ratios?symbol=ANN
Prendergast, K. Client acceptance procedures best practices among accounting firms. p 1-4. Retrieved from: http://mail.google.com/mail/u/0/?ui=2&shva=1#inbox/13f8c14979e1d047
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