Audit Evidence and Conclusions for various fixed asset questions

Audit Conclusions or Situations 1. The choice of eight years for straight-line depreciation of the company’s trucks appears unreasonable. I would suggest that the client change to a six-year life and use DDB depreciation. 2. Insurance coverage appears to be inadequate, because the client has chosen to carry only liability ...continues

Detection of Fraud through Audit Procedures

Please read the attached case study and answer: When Mrs. Levi informed the CPA of her suspicions regarding Betty, what responsibilities, if any, did the CPA have to pursue this matter? In addition to preparing tax returns for Howard Street Jewelers, alternately assume that the CPA (a) audited the business’s annual financial ...continues

Auditing Questions

How can a purchasing manager use his/her position to defraud the company? What can be done to prevent it? Where could an auditor look to find evidence of losses on purchase commitments and unrecorded liabilities to vendors? Many companies use the computer to generate purchase orders. Who is responsible for authorizing a purch ...continues

Subsequent Events Procedures

The period between the balance sheet date and the date of the auditor report is called the subsequent period. Audit procedures performed in this period are called the subsequent events review. The significance of the audit report date is that it is the cutoff point for an auditor’s responsibility to be informed about events ...continues

Audit Program for Cash including objectives and procedures for a comprehensive audit of cash accounts.

The audit program for cash contains a statement of the audit objectives, the complete and detailed procedures, and a conclusion. It is adapted from PPC, a division of Thompson Publishing.

Auditing

SECTION III: YRS, Incorporated Balance Sheet Year Ended December 31, 2006 Cash 100 Accounts Receivable 200 Total Assets 300 Accounts Payable 150 Capital Stock 100 Total 250 YRS Incorporated Income Statement for the Period ending December 31, 2006 Net Sales 500 Cost of Goods sold 10 ...continues

Auditing: 25 T-F plus an audit program for cash

TRUE OR FALSE 1. The Sarbanes Oxley Act was implemented by Germany in 2002. 2. The evaluation of the internal control environment is the responsibility of management. 3. GAAS refers to General Accounting and Auditing Standards. 4. GAAP refers to Generally Accepted Accounting Practices. 5. Confirmation of customer account ...continues

Auditing Problem - Inventories & Cost of Goods Sold

Ace Corporation does not conduct a complete annual physical count of purchased parts and supplies in its principal warehouse, but uses statistical sampling instead to estimate the year-end inventory. Ace maintains a perpetual inventory record of parts and supplies and believes that statistical sampling is highly effective in det ...continues

Auditing Problem-Inventories & Cost of Goods Sold

You have been engaged by the management of Alden, Inc., to review its controls over the purchase, receipt, storage, and issue of raw materials. You have prepared the following comments, which describe Alden’s procedures. 1) Raw materials, which consist mainly of high-cost electronic components, are kept in a locked storeroom. ...continues

Auditing Problems - Property, plant, and equipment: Depreciation and Depletion

Nova Land Development Corporation is a closely held corporation engaged in purchasing large tracts of land, subdividing the tracts, and installing paved streets and utilities. The Corporation does not construct buildings for the buyers of the land and does not have any affiliated construction companies. Undeveloped land usually ...continues