Bubba Tech Inc

Topics: Audit, Corporate governance, Public company, Fiduciary, Board of directors, Internal control / Pages: 11 (2583 words) / Published: Dec 8th, 2013
CASE 3-2
QUESTION SUMMARY
This case is about two friends which are Willie Carson and Waylon Boone who grew up in Dallas, Texas. Both of them went to University of Texas. Carson graduated with Accounting degree while Boone in Computer Science degree. Then, Carson went to work for accounting and assurance services at one of larges accounting firm in world, Randy Burnham & Co. While, Boone went to work at one of the largest manufactures of high-tech product in world, Alorotom Inc.
After seven years working, Carson became a certified public accountant and Boone successfully complete a master’s degree program in Information System at Southern Methodist University.
In 2001, Carson and Boone formed a manufacturing company, Bubba Tech Inc. (BTI) in Austin which is privately owned by them and venture capital firm. Boone becomes chief executive officer (CEO) and Carson become chief financial officer (CFO) in BTI. There was no board of director because the firm has completely confidence in the ability of Carson and Boone.
Venture capitalists provide a provision into their agreement where Boone and Carson would received 10% return on their investment for five years and after company went public they would be repaid the amount of their investment. BTI had hired Randy Burnham & Co. to audit its financial statement on 31 December 2012 due to their plan to go for public within five years. Burnham completed its audit for that five years in BTI and give unqualified opinion on the audited financial statement.
In 2007, BTI decided to go as public. In meeting with Burnham’s auditor, Boone ask Clint Strait, the partner who in charge of BTI audit to prepare a list of top operational issues to consider as the company went from being privately held to publicly held corporation.
Then, Strait set up a team to proceed. The teams consist of Randy Burnham and Clint Strait itself, Shania Hill (the manager in charge of audit), Faith Twain (who had in charge consulting services

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