Challenging Public Company Research
Independence Jones and Jones, CPA, has a manufacturing client, Widgit Technologies, Inc. (WTI), that is a small, owner-managed business with annual revenues of approximately $8 million. WTI employs a bookkeeper but is not large enough to employ a CPA in-house. WTI regularly asks Margaret Jones, the partner on the engagement, for advice on accounting issues, and Jones and Jones drafts the financial statements for the company. The client reviews the financial statements before they are printed by Jones and Jones with an audit opinion attached. During the current year, WTI asked Jones and Jones to assist the company by rendering a business valuation service. WTI is asking Jones and Jones to (1) estimate the value of WTI and (2) consult with WTI in the form of making recommendations on steps that WTI can take that will grow the value of the business.
Required
a. Since Jones and Jones is preparing the financial statements for WTI, is Jones and Jones independent with respect to WTI? What conditions, if any, must Jones and Jones meet in order to be independent with respect to WTI?
b. Would Jones and Jones be independent if WTI were a public company subject to SEC rules and regulations? Explain your reasoning.
c. Can Jones and Jones take on the business valuation services and consulting engagement and remain independent with respect to WTI? Explain your reasoning.
d. Can Jones and Jones take on the business valuation services and consulting engagement if WTI were a public company subject to SEC rules and regulations? Explain your reasoning.
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more