Additional Cases for the Course The case readings have been developed solely as a basis for class discussion. The case readings are not intended to serve as a source of primary data or as an illustration of effective or ineffective auditing. Reprinted by permission from Jay C. Thibodeau and Deborah Freier. Copyright © Jay C. Thibodeau and Deborah Freier; all rights reserved. 1••• ( Case 61 ® Enron Enrori’s First Few Years hi~ 1985 Enron had assets along the three major stages of the supply
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Question 1: Name two cases in which companies have committed frauds by misstating inventory. Crazy Eddie and Goodner Brothers case are the good example for the inventory fraud cases. Question 2: What makes the intentional misstatement of inventory difficult to detect? When you have the most senior management of the company‚ particularly its financial management‚ consciously setting out to fool the auditors‚ to hide information from them‚ as they testified in the Monus trial‚ it’s very hard to
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Audit case You are the engagement partner in a firm of chartered accountant and are reviewing the audit fire of a client ABC ltd. the audit manager has recommended that the audit option is qualified because he is in dispute with the directors of ABC ltd. The audit manager wishes the directors to create a large doubtful debts provision against a major debtor that is over six months old. The directors do not witch to alarm the public about the current liquidity problems of their major costumer because
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Case 1.2 1. Revenue recognition principle under GAAP determines the specific conditions under which income becomes realized as revenue. Generally‚ revenue is recognized only when a specific critical event has occurred and the amount of revenue is measurable. For public company‚ performance of financial statement can have significant impact on stock price. It is essential for the users of financial statements to know that the real revenues are recorded and disclosed and not fraudulent revenues.
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Case 6-4 1. All three methods do affect the net income - Deducted Purchased Goods: Will affect the cost of the good by decreasing it‚ which will affect the net income in the period the product is sold. - Other Income: Net Income would be higher than the other methods. - Not taken discount as expense: Cost of goods sold will be lower as discount will be counted‚ however it will decrease net income while being an expense. Overall‚ the cost of goods sold will be affected‚ therefore gross margin
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Summary Phar-Mor‚ Inc. was a deep-discount store that had substantial growth in a short period of time. It started with 15 stores and grew to over 310 stores in thirty two states between 1985 and 1992. At first Phar-Mor was seen as a major prospect in the retail market. With sales of over $3 billion and growing‚ Phar-Mor’s success even worried some of the biggest retail giant‚ including Wal-mart. The president‚ founder‚ and COO of Phar-Mor was Mickey Monus‚ who became quite extravagant with
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Example auditing case 1)” Based on the information given in this case and your knowledge of auditor’s reports‚ identify the deficiencies in the draft of the proposed report. Do not redraft the report‚ but provide justification or explanation for each of the deficiencies you identify” (Pany‚ Auditor’s Report‚ 2010). A. In the Introduction paragraph it states “As discussed in Note K to the financial statements‚ the Company has properly disclosed a subsequent event dated March 14‚ 20x9” (Pany‚ Auditor’s
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Deuteronomy 6:4-6 An Exegetical Research Paper Hear‚ O Israel: The Lord our God‚ the Lord is one. Love the Lord your God with all your heart and with all your soul and with all your strength. These commandments that I give you today are to be upon your hearts. ESTABLISHING THE TEXT The text is a passage known as the Shema (“Hear”) which has become the fundamental dogma of the Old Testament and was also identified in the New Testament (Mark 12:29-30) as the most important of all the commandments
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Mor Was a housemaster of St. Brides school. He suffered deeply from the discovery that his wife was the stronger. He was continually offended. The early years of their marriage had been happy enough. At that time he and Nan had talked nothing but themselves. When this subject failed Mor made the discovery that he was tied for life to a being who could withdraw herself from him and become independent. “You live in a dream world. Neither of your children are clever‚ and you’ve already caused
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BF3394 – AUDITING AND PROFESSIONAL ETHICS Module Number: Module Title: BF3394 AUDITING & PROFESSIONAL ETHICS 10 credits Number of Aston Credits: Total Number of ECTS Credits: 5 credits (European Credit Transfer) Staff Member Responsible for the Module: Dr Melina Manochin Finance and Accounting Group ABS Building‚ Room 410‚ Extension 3732 m.m.manochin@aston.ac.uk Availability: Please see office hours on door or group administrator‚ Ms Rosaleen Shirley‚ ABS 404‚ Extension 3238 Other Staff
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