PENGANTAR PRATIK PENGAUDAITAN

ASSIGNMENT 14
“COMPLETING THE AUDIT ASSIGNMENT (WUP 13 - 15)”

Disusun Oleh :
Kelompok 13
Siti Arifah 041911333010
Kalyana Hasna D. 041911333058
M. Alif Hidayar 041911333083
M. Aqsal Indra Syukur 041911333158

PROGRAM STUDI S1 AKUNTANSI

FAKULTAS EKONOMI DAN BISNIS
UNIVERSITAS AIRLANGGA
SURABAYA
2021

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12. Identify information you believe should be included in notes to the financial
statements. Draft the notes. You can use last year’s as a guide.
Jawaban :
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Apollo Shoes, Inc.

1. Summary of Significant Accounting Policies

Business activity: The Company develops and markets technologically superior

podiatric athletic products under various trademarks, including SIREN, SPOTLIGHT,
and SPEAKERSHOE.
Marketable Securities: Investments are valued using the market value method for
investments of less than 20%, and by the equity method for investments greater than
20% but less than 50%.
Cash equivalents: Cash equivalents are defined as highly liquid investments with
original maturities of three months or less at date of purchase.
Inventory valuation: Inventories are stated at the lower of First-in, First-out (FIFO)
or market.
Property & Equipment, Depreciation: Property and equipment are stated at cost.
The Company uses the straight-line method of depreciation for all additions to property,
plant, and equipment.
Net Sales: Sales for 2017 and 2016 are presented net of sales returns and allowances of
$11.1 million, and $4.5 million, respectively, and net of warranty expenses of $1.2
million, and $1.1 million, respectively.
Net income per common share: Net income per common share is computed based on
the weighted average number of common and common equivalent shares outstanding
for the period.
Reclassification: Certain amounts have been reclassified to conform to the 2017
presentation.

2. Significant Customers
Approximately 53%, and 15% of sales are to one customer for years ended December
31, 2017 and 2016, respectively. See note 13.

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3. Accounts Receivable

Accounts Receivable consists of the following at December 31:

in thousands 2017
Trade Receivables $51,515
Less Allowance for Doubtful Accounts ($1,239)
Net Accounts Receivable $50,276

There was no bad expense for the year ended December 31, 2017 . There was one write
off for the year in the amount of $23,810.

4. Inventories

Inventories consist of the following at December 31:

in thousands 2017
Siren $13,226
Speaker $33,448
Spotlight $20,750
$67,424
Less Reserve for Inventory Obsolescence ($3,012)
Ending Inventory $64,412

5. Property and Equipment

In early 2017 , the Company purchased equipment totaling $1,295,360 to facilitate

internal production of Apollo products. As of January 2018, that equipment is not yet
in operation. In mid-2017 , the Company purchased a new computer system totaling
$1,200,000, including related installation and consulting services.

Property is stated at cost net of accumulated depreciation. Property and Equipment at

December 31 was as follows:

in thousands 2017
Land $117

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Buildings and Land Improvements $624
Machinery, Equipment, and Office Furniture $2,929
Total Land, Plant, and Equipment $3,670
Less Accumulated Depreciation ($683)
Net Land, Plant, and Equipment $2,987

6. Investments and Other Assets

In 2015, the Company invested approximately $0.6 million in a stock for a 35% share
in the SHOCK-PROOF SOCKS Company. SHOCK-PROOF SOCKS did not recognize
any income and did not pay any dividends in 2015 or 2016. In 2017 , SHOCK-PROOF
SOCKS recognized $3,130,610 in income, but did not pay any dividends. Accordingly,
Apollo recognized $1,096 thousand in equity earnings. In 2017 , Apollo purchased
20,000 shares of Synergizer Battery Company totaling $330,375. In addition, the
Company decided to write off the legal fees incurred to register the patent for the
PHONESHOE. The asset was originally going to be amortized over 17 years, but the
Company decided to write off the remaining $53,840 during 2017 .

7. Debt

At December 31, 2017 , the Company had $44,403,000 outstanding in short-term

borrowings under a $50,000,000 unsecured revolving credit line with a local financial
institution. The line of credit is secured with the Company’s inventory. The interest
rate as of year-end was 9.16%. The due date on this line of credit is 2018 (revolving).
This line of credit is evaluated annually on June 30th by the lending institution.
At December 31, 2017, the Company had $12,000,000 debt due January 1, 2015. The
interest rate is 8.15%.
Total debt outstanding at December 31, 2017 is $56,403,000.

8. Commitments

The Company’s lease on a second facility and equipment terminated in June 2017 . At
that time, all operations were moved to the central headquarters. Rent expense charged

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to operations for the years ended December 31, 2017 and 2016 was $1.2 million and
$2.6 million, respectively.

9. Income Taxes
The income taxes for 2017 were computed at an effective tax rate of 40.0%, 34.0% in
federal income taxes, and 6.0% in state income taxes.

10. Litigation
On January 5, 2018, a class action lawsuit alleging gross negligence and violation of
implied warranty of merchantability was filed against Apollo Shoes, Inc. for
$12,000,000. According to Apollo’s attorney, the plaintiff will have serious problems
establishing Apollo’s liability. However, if the plaintiff is successful, the damages
awarded could be substantial. The Company plans to vigorously defend itself in this
action, but it is reasonably possible that the loss could reach $10,000,000 after legal
fees are considered.

On September 12, 2016, Apollo settled a lawsuit brought against the Company by a
competitor for patent infringement. The Company denied any wrongdoing, but felt the
settlement, in the amount of $11,695,000 ($19,172,000, net of tax benefit of
$7,477,000), would be preferable to a long litigation process.

11. Related Party Transactions

Apollo purchased a new computer system for $1,000,000 in July 2017 . The Company
paid Josephine Mandeville, a member of the Board of Directors and the Audit
Committee, $200,000 for system analysis consulting with regard to this purchase of
computer equipment.

Apollo buys all of their shoes pre-made from the Anglonesia Rehabilitation and
Reprogramming Institute in Anglonesia. Theodore Horstmann, a member of the Board
of Directors and the Audit Committee, is the Minister of Commerce of Anglonesia. The
Company purchased equipment totaling almost $1.3 million in early 2017 to facilitate
internal production of Apollo shoes. Apollo received a large shipment of shoes totaling

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over $8.4 million from the Institute on December 31, 2017 . As of January 2018, the
production equipment had not yet been put into operation.

The company issued a $1,250,000 loan to Larry Lancaster’s secretary with a 1% annual
interest rate. The note and interest are due in full on June 30, 2017.

12. Employee Benefit Plans

The Company sponsors a defined-contribution retirement plan covering substantially

all of its employees. Contributions are determined at the discretion of the Board of
Directors. Aggregate contributions made by the Company to the plans and charged to
operations in 2017 , 2016, and 2015 were $3.3 million, $3 million, and $3 million,
respectively.

13. Concentrations of Credit Risk

Financial instruments which potentially subject the Company to credit risk consist
principally of trade receivables and interest-bearing investments. The Company
performs ongoing credit evaluations of all of its customers and generally does not require
collateral. The Company places substantially all of its interest-bearing investments with
several major financial institutions. Corporate policy limits the amount of credit
exposure to any one financial institution.

The Company sells over half of its product to one retail distributor with sales operations
located throughout North America, Europe, and Asia Pacific. That retail distributor filed
for involuntary bankruptcy in November 2017 . The distributor informed Apollo of the
bankruptcy shortly thereafter. A shipment of shoes totaling over $5.7 million was
sent to this distributor without a purchase order on December 28, 2017 . The distributor
denies ever ordering the shoes. However, Apollo’s management feels that this distributor
will come out of the bankruptcy and be able to pay Apollo the over $20 million in
receivables it owes, including the late December shipment of $5.7 million. The $5.7
million sale has been included in revenues.

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13. Draft any management letter comments on anything you believe Apollo Shoes can
do better from an operational economy and/or efficiency perspective, or methods
of strengthening their internal controls.

Jawaban :

Apollo Shoes Inc

Management Letter
6 March 2018

Internal Control Over Financial Reporting

We also audited the effectiveness of the Company’s internal control over

financial reporting as of December 31, 2017, based on criteria established in Internal
Control—Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO). The Company’s management is responsible for
maintaining effective internal control over financial reporting. Our responsibility is to
express an opinion on the effectiveness of the Company’s internal control over financial
reporting based on our audit. We conducted our audit of internal control over financial
reporting in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal control over financial
reporting was maintained in all material respects. An audit of internal control over
financial reporting includes obtaining an understanding of internal control over financial
reporting, evaluating management’s assessment, testing and evaluating the design and
operating effectiveness of internal control, and performing such other procedures as we
consider necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinions.
A company’s internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (i) pertain to the maintenance of records that,
in reasonable detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company; (ii) provide reasonable assurance that transactions are

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recorded as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the
company are being made only in accordance with authorizations of management and
directors of the company; and (iii) provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may
not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because
of changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.
A material weakness is a deficiency, or a combination of deficiencies, in internal
control over financial reporting, such that there is a reasonable possibility that a material
misstatement of the company’s annual or interim financial statements will not be
prevented or detected on a timely basis. The following material weaknesses have been
identified, but were not included in management’s assessment. The Company did not
maintain effective internal control over financial reporting relating to revenue and
expense recognition. Although the Company corrected for many of the material
misstatements we found, the Company did not adjust its financial statements for two
material misstatements noted in our report on the Company’s audited financial
statements.
The material weaknesses were considered in determining the nature, timing and extent
of audit tests applied in our audit of the consolidated financial statements as of and for
the year ended December 31, 2017, of the Company. In our opinion, because of the effect
of the material weaknesses identified above on the achievement of the objectives of the
control criteria, the Company has not maintained effective internal control over financial
reporting as of December 31, 2017, based on the criteria established in Internal Control—
Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission.

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 14. Draft an audit report to go with the financial statements you drafted (put it in the
A-series workpapers).
Jawaban :
LAPORAN AUDITOR TERDAFTAR
PCAOB INDEPENDEN
KEPADA DIREKSI DAN PEMEGANG
SAHAM
APOLLO SHOES, INC.
Kami telah mengaudit neraca konsolidasian
Apollo Shoes, Inc. pada tanggal 31 Desember
2017, dan laporan laba rugi konsolidasi, ekuitas,
dan arus kas terkait untuk tahun yang berakhir
pada tanggal 31 Desember 2017. Laporan
keuangan ini adalah tanggung jawab manajemen
Perusahaan. Kami juga telah mengaudit
penilaian manajemen, termasuk dalam Laporan
Manajemen tentang Pengendalian Internal atas
Pelaporan Keuangan, bahwa Apollo Shoes, Inc.
mempertahankan pengendalian internal yang
efektif atas pelaporan keuangan pada tanggal 31
Desember 2017, berdasarkan kriteria yang
ditetapkan dalam Pengendalian Internal -
Kerangka Terintegrasi dikeluarkan oleh Komite
Organisasi Sponsor dari Treadway Commission
(kriteria COSO). Tanggung jawab kami adalah
untuk menyatakan pendapat atas laporan
keuangan tersebut berdasarkan audit kami.
Tanggung Jawab Manajemen atas Laporan
Keuangan Konsolidasian
Manajemen bertanggung jawab atas
penyusunan dan penyajian laporan keuangan
yang adil, sesuai dengan Dewan Pengawas
Akuntansi Perusahaan Publik (PCAOB) yang
berlaku umum. Manajemen juga bertanggung
jawab untuk mempertahankan pengendalian
internal yang efektif atas pelaporan keuangan
REPORT OF INDEPENDENT PCAOB
REGISTERED AUDITORS
TO THE BOARD OF DIRECTORS AND
SHAREHOLDERS
We have audited the accompanying consolidated
balance sheet of Apollo Shoes, Inc. as of
December 31, 2017, and the related consolidated
statements of income, shareholders’ equity, and
cash flows for the year ended December 31,2017.
These financial statements are the responsibility
of the Company’s management. We have also
audited management’s assessment, included in
the accompanying Management’s Report on
Internal Control Over Financial Reporting, that
Apollo Shoes, Inc. maintained effective internal
control over financial reporting as of December
31, 2017, based on criteria established in
Internal Control – Integrated Framework issued
by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO
criteria). Our
responsibility is to express an opinion on these
financial statements based on our audits.
Managements Responsibilities for the
Consolidated Financial Statements
Management is responsible for the preparation
and fair presentation of the financial statements,
in accordance with the generally accepted
Public Company Accounting Oversight Board
(PCAOB). Management is also responsible for
maintaining effective internal control over
financial reporting relevan dengan
penyusunan dan penyajian
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wajar laporan keuangan yang merupakan salah
saji material dalam bentuk bebas
Tanggung Jawab Auditor
Tanggung jawab kami adalah untuk menyatakan
pendapat atas laporan keuangan ini, pendapat
atas penilaian manajemen, dan pendapat tentang
efektivitas pengendalian internal perusahaan
atas pelaporan keuangan berdasarkan audit
kami. Kami melaksanakan audit kami sesuai
dengan standar audit dari Dewan Pengawas
Akuntansi Perusahaan Publik (PCAOB).
Standar tersebut mengharuskan kami
merencanakan dan melaksanakan audit agar
kami memperoleh keyakinan memadai tentang
apakah laporan keuangan bebas dari salah saji
material. Suatu audit mencakup pemeriksaan,
atas dasar pengujian, bukti-bukti yang
mendukung jumlah-jumlah dan pengungkapan
dalam laporan keuangan. Audit juga meliputi
penilaian atas prinsip akuntansi yang digunakan
dan estimasi signifikan yang dibuat oleh
manajemen, serta penilaian terhadap penyajian
laporan keuangan secara keseluruhan. Kami
yakin bahwa audit kami memberikan dasar yang
masuk akal untuk laporan kami.
Suatu audit melibatkan pelaksanaan prosedur obtain audit evidence about the amounts and
untuk memperoleh bukti audit tentang jumlah
dan pengungkapan dalam
relevant to the preparation and fair presentation
of. financial statements that are free form
material misstatements
Auditor’s Responsibility
Our responsibility is to express an opinion on
these financial statements, an opinion on
management’s assessment, and an opinion on
the effectiveness of the company’s internal
control over financial reporting based on our
audits. We conducted our audit in accordance
with auditing standards of the Public Company
Accounting Oversight Board (PCAOB). Those
standards require that we plan and perform the
audit to obtain reasonable assurance about
whether the financial statements are free of
material misstatement. An audit includes
examining, on a test basis, evidence supporting
the amounts and disclosures in the financial
statements. An audit also includes assessing
the accounting principles used and significant
estimates made by management, as well as
evaluating the overall financial statement
presentation. We believe that our audits
provide a reasonable basis for our report.
An audit involves performing procedures to
disclosures in the consolidated financial
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laporan keuangan konsolidasian. Prosedur statements. The procedures selected depend on
yang dipilih bergantung pada pertimbangan the auditors' judgment, including the
auditor, termasuk penilaian risiko assessment of the risks of material
atas
kesalahan penyajian material dalam laporan misstatement of the consolidated financial
keuangan konsolidasian, baik yang statements, whether due to fraud or error. In
disebabkan oleh kecurangan maupun making those risk assessments, the auditors
kesalahan. Dalam membuat penilaian risiko consider internal control relevant to the
tersebut, auditor mempertimbangkan entity's preparation and fair presentation of
pengendalian internal yang relevan dengan the consolidated financial statements in order
penyusunan entitas dan penyajian yang wajar to design audit procedures that are
atas laporan keuangan konsolidasian dalam appropriate in the circumstances, but not for
rangka merancang prosedur audit yang sesuai the purpose of expressing an opinion on the
dengan situasinya, tetapi tidak untuk tujuan effectiveness of the entity's internal control.
menyatakan opini tentang efektivitas An audit also includes evaluating the
pengendalian internal entitas. Suatu audit juga appropriateness of accounting policies used
mencakup pengevaluasian atas ketepatan and the reasonableness of accounting
kebijakan akuntansi yang digunakan dan estimates made by management, as well as
kewajaran estimasi akuntansi yang dibuat evaluating the overall presentation of the
oleh manajemen, serta pengevaluasian atas consolidated financial statements
penyajian laporan keuangan konsolidasian
secara keseluruhan.

Opini Opinion
Menurut opini kami, dengan pengecualian In our opinion, with the exception of the
dari hal-hal yang diungkapkan di atas, laporan matters disclosed above, the financial
keuangan yang disebutkan di atas menyajikan statements referred to above present fairly, in
secara wajar, dalam semua hal yang material, all material respects, the financial position of
posisi keuangan Apollo Shoes, Inc. pada Apollo Shoes, Inc. as of December 31, 2017,
tanggal 31 Desember 2017, dan hasil and the results of its operations and its cash
operasinya dan arus kasnya untuk tahun yang flows for the year then ended in conformity
kemudian berakhir sesuai dengan prinsip with accounting principles generally accepted
akuntansi yang berlaku umum Dewan

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Pengawas Akuntansi Perusahaan Terbuka Public Company Accounting Oversight Board

(PCAOB) (PCAOB)

March 6, 2018

Anderson, Olds, and Watershed

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 APOLLO SHOES, INC.
Going Concern Memo
31 December 2017

Keputusan untuk mengeluarkan pengungkapan going concern adalah sangat

serius sebab berbagai alasan. Sebagai auditor, kami memiliki tanggung jawab untuk
memberikan jaminan yang wajar kepada pemangku kepentingan klien kami bahwa
pernyataan yang dibuat oleh manajemen dalam laporan keuangan perusahaan adalah
sah. Dalam menerbitkan pengungkapan going concern, kami dapat kehilangan klien
karena perusahaan mengalami likuidasi atau klien bertahan dan tidak likuidasi. Jika
pengungkapan going concern tidak sah, terlebih lagi, kami mengambil risiko litigasi
tambahan dari pemegang saham perusahaan atas hilangnya nilai pemegang saham yang
disebabkan di pasar saham ketika keraguan serius tentang going concern perusahaan
menjadi jelas. Jika kami gagal mengeluarkan pernyataan tentang going concern, kami
berisiko menghadapi litigasi lebih lanjut karena gagal menjalankan kehati-hatian
profesional dalam melakukan audit kami. Dalam kasus ini, kami mempertaruhkan
reputasi Kantor Akuntan Publik kami sebagai penyedia layanan jaminan yang andal.
Ada sejumlah faktor yang membuat kami memiliki keraguan substansial tentang
kemampuan Perusahaan untuk terus bertahan :
1. Karyawan Perusahaan, pada tanggal ini, melakukan pemogokan.
2. Perusahaan telah kehilangan pelanggan utamanya, yang mencakup lebih dari
50% penjualan tahun berjalan.
3. Kami memiliki keraguan yang signifikan mengenai apakah Perusahaan dapat
menagih piutang atau menjual persediaannya untuk menghasilkan arus kas yang
positif.

Karena masalah ini, penting untuk mengungkapkan keraguan substansial kami

mengenai kemampuan Perusahaan untuk terus berkelanjutan dalam laporan audit kami.

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 APOLLO SHOES, INC.
Subsequent Events Memo
31 December 2017

a. Peristiwa kemudian harus diungkapkan karena laporan keuangan diterbitkan setelah

tanggal neraca sebenarnya. Pengguna laporan keuangan berhak memiliki dokumen
(laporan keuangan dan catatan atas laporan keuangan) yang terbaru sejak (hampir)
waktu mereka menerima dan menggunakannya. Oleh karena itu, "peristiwa kemudian"
relevan bagi pengguna ketika mereka menerima laporan keuangan setelah tanggal
neraca.
b. Prosedur Peristiwa Kemudian
Membaca dan membandingkan laporan keuangan interim.
Bertanya kepada pejabat dan direktur tentang pernyataan sementara dan hal-hal
penting lainnya.
Membaca risalah rapat pemegang saham, direktur, dan komite penting lainnya.
Mendapatkan surat pengacara.
Mendapatkan representasi klien tertulis.
Membuat pertanyaan lain dan melakukan pekerjaan lain yang dianggap perlu.
c. Item untuk peristiwa kemudian
1) Pemogokan dan mungkin pengaruhnya terhadap perusahaan perlu
diungkapkan.
2) Mengacu pada audit Apollo Shoes, Inc. pengacara Apollo telah mengonfirmasi
bahwa gugatan class action telah diajukan terhadap Apollo pada tanggal 5
Januari 2015. Gugatan tersebut berisi menuduh kelalaian besar dan pelanggaran
jaminan tersirat untuk dapat diperjualbelikan. Pengacara Apollo juga
menyatakan bahwa meskipun dia yakin bahwa penggugat akan memiliki
masalah dalam menetapkan tanggung jawab Apollo Shoes, ganti rugi yang
diberikan dalam kemenangan penggugat bisa sangat besar. Dia juga
memperkirakan bahwa kerugian Apollo Shoes bisa mencapai $ 10.000.000
setelah biaya hukum dipertimbangkan. Gugatan ini harus diungkapkan dalam
catatan yang menyertai laporan keuangan, dan mungkin ditekankan dalam
paragraf tambahan yang dilampirkan pada laporan audit.

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 A-2

Apollo Shoes, Inc.

Shoetown, ME

STATEMENT OF RESPONSIBILITY OF 2017 ANNUAL REPORT BY THE BOARD OF

DIRECTORS AND BOARD OF COMMISSIONERS
Kami yang bertanda-tangan di bawah ini :

1. Nama : Larry Lancaster

Alamat Kantor : Apollo Shoes, Inc.
100 Shoe Plaza
Shoetown, ME 00001
Jabatan : Chairman, President And CEO
2. Nama : Eric P. Unum
Alamat Kantor : Apollo Shoes, Inc.
100 Shoe Plaza
Shoetown, ME 00001
Jabatan : Vice-President of Finance

Menyatakan Bahwa :

Kami mengakui tanggung jawab kami atas penyajian laporan keuangan yang
wajar sesuai dengan prinsip akuntansi yang berlaku umum.
Kami mengonfirmasi, sejauh pengetahuan dan keyakinan kami, representasi
berikut:
1. Laporan keuangan sebagaimana dimaksud di atas laporan keuangan posisi
keuangan, hasil operasi, dan arus kas, disajikan secara wajar sesuai dengan
prinsip akuntansi yang berlaku umum.
2. Kami telah menyediakan untuk Anda semua terkait :
a. Catatan keuangan dan data terkait.
b. Risalah rapat pemegang saham, direksi, dan komite direksi, atau ringkasan
dari rapat terakhir yang belum dibuat risalahnya.
3. Tidak ada komunikasi dari badan pengatur tentang ketidakpatuhan atau
kekurangan dalam praktik pelaporan keuangan.

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4. Tidak ada transaksi material yang belum tercatat dengan baik dalam catatan
akuntansi yang mendasari laporan keuangan.
5. Belum ada—
a. Kecurangan yang melibatkan manajemen atau karyawan yang memiliki
peran signifikan dalam pengendalian internal.
b. Kecurangan yang melibatkan pihak lain yang dapat berdampak material
terhadap laporan keuangan.
6. Perusahaan tidak memiliki rencana atau niat yang secara material dapat
mempengaruhi nilai tercatat atau klasifikasi aset dan liabilitas.
7. Berikut ini telah dicatat atau diungkapkan dengan benar dalam laporan keuangan:
a. Transaksi pihak terkait, termasuk penjualan, pembelian, pinjaman, transfer,
pengaturan sewa guna usaha, dan jaminan, dan jumlah piutang dari atau
hutang kepada pihak berelasi.
b. Jaminan, baik tertulis atau lisan, yang menjadi tanggung jawab perusahaan.
c. Estimasi signifikan dan konsentrasi material yang diketahui manajemen
yang harus diungkapkan sesuai dengan Pernyataan Posisi 94-6 AICPA, ''
Pengungkapan Risiko dan Ketidakpastian Signifikan. ''
8. Tidak ada-
a. Pelanggaran atau kemungkinan pelanggaran hukum atau peraturan yang
pengaruhnya harus dipertimbangkan untuk diungkapkan dalam laporan
keuangan atau sebagai dasar untuk mencatat kemungkinan kerugian.
b. Klaim atau penilaian yang tidak ditegaskan yang telah disarankan
pengacara kami kepada kami kemungkinan besar dinyatakan dan harus
diungkapkan sesuai dengan Pernyataan Financial Accounting Standards
Board (FASB) No. 5, '' Akuntansi untuk Kontinjensi. ''
c. Liabilitas atau kontinjensi keuntungan atau kerugian lainnya yang harus
diakui atau diungkapkan oleh Pernyataan FASB No. 5.
9. Perusahaan memiliki kepemilikan yang memuaskan atas semua aset yang
dimilikinya, dan tidak ada hak gadai atau sitaan atas aset tersebut dan tidak ada
aset yang dijadikan jaminan.
10. Perusahaan telah mematuhi semua aspek perjanjian kontraktual yang akan
berdampak material terhadap laporan keuangan jika terjadi ketidakpatuhan.

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11. Sepanjang pengetahuan dan keyakinan kami, tidak ada peristiwa yang terjadi
setelah tanggal neraca dan melalui tanggal surat ini yang memerlukan penyesuaian
atau pengungkapan dalam laporan keuangan tersebut.

16 Februari 2018

Larry Lancaster,
Chairman, President, and CEO

Eric P. Unum,
Vice-President of Finance

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