Question Tag: Audit Firm Management

a)

Nii Adjei & Associates is a firm of Chartered Accountants that provides various services (including Audit, Assurance, Tax, and Advisory services) to clients undertaking various services. Nii Adjei & Associates has offices in Accra, Tema, Koforidua, and Kumasi.

Owusu Mensah was the quality control partner of Nii Adjei & Associates. Owusu Mensah had started the implementation of an ethical compliance system for the assurance staff when he was involved in an accident on the Tema motorway on his way home and died. The said system required that staff should confirm in writing their compliance with the code of ethics of The Institute of Chartered Accountants (Ghana). Arrangement to get a replacement for Owusu Mensah had not been completed.

Osei Acquah was the engagement partner in charge of C. Kokuvi Ltd. (a major client that Nii Adjei & Associates provides audit service, preparation of tax computations, and other advisory services). Osei Acquah had an attack on his brain which resulted in a stroke. This forced Nii Adjei & Associates to engage Thomas Essien as the new engagement partner to take charge of the audit of C. Kokuvi Ltd. C. Kokuvi Ltd is not prepared to increase the audit fees from that of the previous year despite the fact that additional work has to be performed as a result of the introduction of a new computer system.

In addition, the starting date of the audit has been delayed as a result of problems with the new system.

Required:

Discuss any quality control issues identified in the above scenarios and recommend the action which should be taken by Nii Adjei and Associates. (10 marks)