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Essay text:
CEC has always received standard unqualified opinions from NP and NP believes CEC has an excellent reputation. However, upon further inquiries, there are some areas of concern which may change the amount of work we assign for the engagement as the acceptable audit risk has been set at 5% and the potential for future growth and success with the company is high.
High AAR
CEC is a public company that is expected to grow significantly in the future. As the company grows in size, more assets or revenues will be affected and more financial statements will be highly relied on by external users. Therefore, more appropriate that the AAR should be decreased, I recommend decreasing CEC's AAR to 3%...
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