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As the CPA for a large organization, your manager has
asked you to provide information to outside CPAs who are examining
a subsidiary that has been set up as a corporation. As part of
their review, the CPAs have asked you to provide them with the
following explanations:

The methodology used to determine deferred taxes

The procedures for reporting accounting changes and error

The rationale behind establishing the subsidiary as a
Prepare your response to the three
questions. Before submitting your response, your manager would like
to know a little bit more about the request. She has asked you to
tell her what your professional responsibilities are as a CPA, and
the difference between a review and an audit.
Provide draft responses to
the above questions. Additionally, provide your manager with a
summary of your responsibilities in an internal memo (no more than
1,050 words).


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