It is Monday September 16 2013 You CA work at #26

It is Monday, September 16, 2013. You, CA, work at Fahmy & Gingras LLP, a CA ?rm. Ken
Ndiaye, one of the partners, approaches you mid-morning regarding Brennan & Sons Limited
(BSL), a private company client for which you performed the August 31, 2012, year-end audit.
“It seems there have been substantial changes at BSL this year,” Ken explains. “I’m going
there tomorrow, and since you will be on the audit again this year, it would be bene?cial for you
to come. I took the liberty of retrieving information from last year’s ?les so you can refresh your
memory about this client (Exhibit C5-1(a)).” The next day, you and Ken meet with Jack Wright,
the accounting manager at BSL. Jack gives you the internally prepared ?nancial statements. To
your surprise, there are also ?nancial statements for two new companies. Jack quickly explains
that BSL incorporated two subsidiaries in January 2013, each with the same year end as BSL:
Brennan Transport Ltd. (Transport) - 100% owned by BSLBrennan Fuel Tank Installations Inc.
(Tanks) - 75% owned by BSL You diligently take notes during the meeting. Jack states that BSL
will prepare consolidated ?nancial statements for audit based on Canadian Generally Accepted
Accounting Principles (GAAP) to satisfy the bank’s request. Ken asks that you work on the
overall planning for these engagements. As part of your planning, he asks you to discuss the
new accounting issues that arise as a result of the changes during the year and to evaluate their
implications for the engagements. Later that day, Ken also forwards you an email from
Jack.Required Prepare the report requested by Ken.
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It is Monday September 16 2013 You CA work at

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