While evaluating Apollo Shoes‚ there are some areas of concern that are potential fraudschemes. The fraud can lead to the entire collapse/demise of the company if not corrected.These will also affect the share value and investor confidence. An overview of the process of investigation along with recommendations for the company.As with any company‚ revenue recognition is an important part of operations of a ApolloShoes. As stated in GAAP standards‚ revenue generated must be realistic and recognizable
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Mr. Lancaster‚ The firm of Anderson‚ Olds‚ and Watershed is pleased to receive your notification to proceed with the audit and look forward to working with you. From the Audit Committee meeting minutes‚ we understand that Apollo Shoes requires help with the yearly audit because the former CPA firm withdrew unexpectedly (University of Phoenix‚ n.d.). Anderson‚ Olds‚ and Watershed will conduct the audit and “prepare the state franchise tax returns as well as the federal tax returns” (University
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my recent promotion; I look forward to working with you on the new Apollo Shoes engagement. I have read all the information you sent me about Apollo Shoes to gain a better understanding of the company‚ and I feel like I have a firm grasp of the company structure and environment. After reviewing the company’s last three board of directors meetings‚ I determined what expertise would be necessary to carry out the audit on Apollo Shoes. If you can assign these staff to our audit team‚ the productivity
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Prior to the cash receipts reaching the accounts receivable clerk‚ the auditor should make a list of all cash receipts without the clerk’s knowledge. After the clerk posted cash receipts to the journal‚ the auditor should compare the details of the cash receipt listings he made to the detail of daily deposit tickets made by the clerk. 2. Trace a sample of customers’ accounts from journal to ledgers. 3. Investigate debit entries in the general ledger cash account other than from the cash receipt journal
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000 Warranty Liability $2‚000‚000 To record the estimated warranty liability. To mark down the loss on the inventory that is now obsolete‚ one first has to figure out the Net Realizable Value‚ which is the lower of cost of market. Since they can sell the products for $8 million minus the selling cost of 20% of the sales revenue ($1.6 million) and the cost to rebuild the inventory of $2 million‚ the ceiling is then $4.4 million and the floor is $4 million ($4.4 million minus the 5% normal profit
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with the Revenue Cycle‚ I want you to prepare a bridge working paper for the audit of Apollo Shoes as of December 31‚ 2007‚ listing the major errors that could occur in the purchasing system and to describe the test of controls procedures for auditing related purchasing controls to determine whether reliable control exists. I don’t think that Apollo has enough purchase transactions that we need to rely on the controls (in other words‚ we’ll look at them all)‚ but we need to document our finding for
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Notes on Apollo Shoes Audit Case Task #1 (Overview/Intro) Go to the “Weekly Materials” folder and locate the “Apollo Shoes Files” folder‚ between the week 1 and week 2 folders. Under this menu you will find a file entitled Apollo Shoes Case Study.doc. This file gives you all of the details and evidence that you will need for the case. We will only be completing specified sections of this case as discussed below. Review the table of contents in the case document (page 4.) This will tell you
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accounts. Recalculate the total and trace to the general ledger control account. 2. Review the aging for large and unusual items. 3. Send confirmations to all accounts over $X. Select a random sample of all remaining accounts for confirmation. a.i.1.a.i.1.a. Investigate exceptions reported by customers. a.i.1.a.i.1.b. Perform alternative procedures on accounts that do not respond to positive confirmation requests. a.i.1.a.i.1.b.i. Vouch cash receipts after the confirmation date for subsequent payment
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area. INVENTORY AND CASH MANAGEMENT SESSION 5 T Cash Can Be Managed as Inventory • Cash managed like inventory in manufacturing o Doesn’t mean physical cash; instead can be ‘quick’ financial instruments:短期国库券 checking accounts t-bills‚ o Demand for cash by organizations‚ individuals varies • Main concepts are: o Need to estimate ‘transactions demand’ o Models for changes in cash balances o Continuous cash management approach • Supply chain of physical cash o Think
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INVENTORY CONTROL Inventory is any stock of economic resources that is stored for future us e it is commonly used to store materials‚ in process packing materials‚ spares etc‚ stocked in order to meet respected demand or distribution in the future. Although inventory of any materials is an idle resources the sense‚ it is not meant for immediate use. It is necessary to maintain some inventories lot the smooth functioning f the organization. Inventories are essential: 1. For adequate customer
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