Instructions: Analyze the given situations and prepare what is asked for you to compute. Answers must be in a paragraph form. Place your output in your notebook. God bless! You are auditing the financial statements of Sakura Store, a retailer of sporting goods, appliances, and electronics. During the prior years' audits of Sakura Store, you noticed that management was less concerned about the timely recording of liabilities and expenses than assets and revenues. As a result, very little of Sakura Store's internal control resources were expended in assuring an accurate and timely recording of accounts payable. You also believed that Sakura Store's management may be motivated to delay recording its liabilities at year end, so you are currently approaching the search for unrecorded liabilities with caution. Questions: a. What are the substantive auditing procedures would you perform in searching for Sakura's unrecorded liabilities? b. How would the nature, timing and extent of your substantive auditing procedures most likely be affected by Sakura Store's deficient control environment?

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