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Disclosure of the Letter of Representation to shareholders

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SAS No. 85, requires that an auditor obtain a management representation letter that is addressed to the auditor, and signed by members of management with overall financial and operating responsibility.

The representation letter includes :
1. management's acknowledgment of responsibility for the financial statements.
2. management believes that the financial statements are presented fairly in conformity with GAAP.
3. management made available all financial records, and all minutes of shareholders' and directors' meetings.
4. management recorded, and made available to the auditor, all transactions.
5. management disclosed, information about management or employee fraud, related party transactions, violations of laws or regulations, contingent liabilities.
6. management made available to the auditor, information about subsequent events.

Do you think this the management letter, and the answers should be made available to shareholders?

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Solution Summary

The solution presents five reasons in support of NOT disclosing the contents of the management letter of representation to the shareholders or other stakeholders of the corporation.

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I don't think the rep letter is the sort of information which would have any positive value to investor or other stakeholders. This opinion is based on the purpose of the rep letter.

First, it provides coverage and defense for the CPA firm, meaning that management confirms the information the auditor team has discovered in the review of ...

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