Part A 1) a)Although a client/company is engaged to perform audits for the 2nd year‚ it does not allow sufficient time for auditor to detect material misstatement. This is due to lack of experience in understanding of the company? Repeat engagement over the years to come would reduce inherent risk Thus‚ the 2nd year of audit would increase inherent risk. b)The bank requires that a/ the company’s interest coverage ratio should be above 9‚ in order to provide loans to the client. From the extract
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25. Fraud is an intentional act involving the use of deception that results in a material misstatement of the financial statements. The two types of misstatements that are relevant to auditors are: The misstatement arising from misappropriation- this occurs when someone steals or misuses an organizations assets. Perpetrators are usually employees and occur when they gain access to cash or cash disbursement accounts and can manipulate them. Misstatement arising from fraudulent financial reporting-
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Auditing Introduction Letter Mahshid Kianipour Instructors: Cecil B. Lucy November 15‚2010 University of Phoenix Auditing Introduction Letter From: Langroodi‚ CPA To : Management of Apollo Shoes‚ Inc. RE: Auditing and assurance services Dear Mr. Jason‚ First‚ I would like to appreciate to giving me this opportunity to explain a couple points related to our firm and services‚ so then I’ll try to make them understandable and short as much as I can; because I know how valuable
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Auditing Research Paper “Auditing is the accumulation and evaluation of evidence about information to determine and report on the degree of correspondence between the information and established criteria” (Arens A.‚ Elder R. J.‚ Beasley M. S. 2010). Auditing of a company should be done by an independent person that has no affiliation with the company that is being audited. The auditor needs to be educated enough to process the audit. There are three different types of auditors‚ external
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Auditing Introduction Letter 22851 Center Street Castro Valley‚ CA. 94546 May 6‚ 2013. Mr. Charles Apollo Shoes 123 Market Street Phoenix‚ Arizona 44444 Dear Mr. Charles‚ AUDITING INTRODUCTION LETTER I am writing this letter to introduce myself‚ my company‚ and the auditing and assurance services we can offer to Apollo Shoes. I will also discuss the benefits of our services as well as the role we will provide and the requirements for meeting the standards for the services we offer. Our firm
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What is Mgt Accounting? Management accounting is a field of accounting that analyzes and provides cost information to the internal management for the purposes of planning‚ controlling and decision making. Management accounting combines accounting‚ finance and management with the leading edge techniques needed to drive successful businesses. Management accounting or managerial accounting is concerned with the provisions and use of accounting information to managers within organizations‚ to provide
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ACCT1059 Assignment (30%) 3-4 students per group. The written part of the assignment needs to be submitted through Blackboard. The team leader needs to submit the assignment on the team’s behalf‚ with a cover sheet listing all team members clearly. Please ensure that you submit only one assignment for your team. Due 29th of September‚ exact time and location ( for hard copies) to be confirmed by the local lecturer. PART A: 10 marks Video capture component ONLY (No written report required):
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The Auditing Process INTRODUCTION Auditing is defined by the American Accounting Association or AAA as “a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between those assertions and established criteria and communicating the results to interested users” (cited in Turney et al p. 108). From that definition‚ it is evident that the auditing process consists of three elements: evidence
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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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Audit Risk Model Summary First: Let’s think about each of the components of the audit risk model. The auditor selects the overall audit risk they are will to accept‚ assesses inherent and control risk at the account (or account group) level‚ and calculates planned detection risk at the account (or account group) level. Audit Risk (AR) is the probability that the auditor issues a clean opinion when the financial statements are materially misstated. Note that acceptable level of audit risk is
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