Case Of Acme Widgets, Inc.

Satisfactory Essays
The reason for the change in auditors is that the predecessor auditor did not have enough resources to audit the company because of the continuous growth of WWW Company. Inventory was the main assets of the company and they needed to get it right. The predecessor auditors had some few concerns and also had few disagreement with the management. The disagreement between the management and the auditors were about how management was not aggressive enough in writing off obsolete inventory. When the auditors decide to write off inventory they had to do research to prove to Williams Jr that it was best for the company to write off. If there was no research the inventory might not be written off. One concern that the auditors have is with the business processes within the company which cannot keep up with the constant growth of the company. The management and the auditors did not have issues about fraud in the company.…show more content…
When John Payne sued the company for payment. John Payne was the Vice-president of the company until he was fired because they found out that he was in discussion to become the Vice-president of sales for one their main competitor, Acme Widgets. Which he took the job after being fired. The reason for the lawsuit is because Payne participated in Willy’s Wonderful widgets, Inc. Phantom Stock Plan and he had vested $100,000 in the plan. The company refuse to pay but at the end the company paid $50,000 and they both paid for their own attorney
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