 In this presentation we will discuss the effects of litigation with regards to an audit engagement and the concept of independence. Commencement of litigation by management alleging deficiencies in audit work for the entity would generally impair independence. So obviously if we're auditing a firm or we're going to be engaged to audit a firm and the firm is engaging in some litigation against the audit firm with regards to the work related to the audit that would impair independence. If we're going to go through the audit process in the future we have a problem here with regards to the pending litigation that would impair independence. Even a situation where there's expressed intent on the part of management to start litigation against the CPA firm, even if management has not started any litigation if there's intent by management to start the litigation against the CPA firm that could be a problem. So expressed intent on the part of management to start litigation against the CPA firm alleging deficiencies in audit work could also impair independence if the auditor feels that it is probable that a claim will be filed. So if we're going to say okay they're kind of threatening to have a claim here if we feel that that's probable that they may file that claim again problem with independence with regards to going through an audit process because of this situation. Because of course if we think about a lawsuit if the lawsuit is going to go in place that can be thought of as a kind of threat or a kind of potential liability in the future. So someone is obviously threatening to sue you or have litigation against you with regards to work that was done in the past with deficiencies of work that could result they're basically saying we're going to want some type of compensation that's what a litigation lawsuit basically does in the future and that if