1. The final responsibility for the integrity of an SEC registrant’s internal controls lies on the management team. U.S. companies need to refer to a comprehensive framework of internal control when assessing the quality of financial reporting to determine that financial statements are being presented under General Accepted Accounting Principles‚ GAAP. The widely used framework is referred as COSO‚ Committee of Sponsoring Organizations of the Treadway Commission‚ sponsored by the following organizations
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Deficiency in internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees‚ in the normal course of performing their assigned functions‚ to prevent‚ or detect and correct‚ misstatements on a timely basis. A deficiency in design exists when (a) a control necessary to meet the control objective is missing‚ or (b) an existing control is not properly designed so that‚ even if the control operates as designed‚ the control objective
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Act‚ 1956 "the Act"). This responsibility includes the design‚ implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement‚ whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute
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performing the annual goodwill impairment testing‚ most companies engage valuation specialists to conduct the analysis. The auditors also rely on the help of the valuation specialist to evaluate the underlying data and assumptions. In this cases a misstatement arising primarily from recent market declines‚ the engagement partner has determined that goodwill for the US reporting unit is a material account balance as of December 31‚ 20X3 because it is quantitatively significant ($280 million) and qualitatively
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Assurance Hand Note Professional Stage-Knowledge Level By: Shafique Ahmed-Sr. Officer (Internal Audit-BSRM) Assurance CA in Bangladesh www.facebook.com/cainbd 1 Assurance Hand Note Professional Stage-Knowledge Level By: Shafique Ahmed-Sr. Officer (Internal Audit-BSRM) CONTENTS OF ASSURANCE 01. 1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 1.11 1.12 Preliminary of Assurance: Assurance Engagement: Key elements of an assurance engagement: Levels of assurance Objective of an Audit: True & Fair
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The London Whale Scandal BU486-B : Accounting Information Systems and Computer Audit & Controls Kevin G. Bullock Wilfrid Laurier University Alexander Brik - 110882860 Aman Smagh – 110257570 Jack Welton – 100791540 Zaid Iqbal – 110184970 Synopsis of the Case In April and May of 2012‚ JP Morgan Chase & Co. incurred major trading losses of $6 billion dollars. However‚ JPMorgan’s financial statements represented these losses as only $2 billion. The losses were the result of
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Accrual concept Accrual Concept is a fall-out of Accounting Period concept. This concept requires that expenses incurred for a particular accounting period should be reckoned in the same period‚ irrespective of the fact whether these expenses have been paid in cash or not in that year. The same holds true for revenues‚ i.e.‚ revenues earned in a specific accounting period are construed as incomes of the same period‚ irrespective of their receipts. This concept is also known as the accrual theory
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1: Does the error represent a material misstatement? According to GAAP‚ information is material "If its omission or misstatement could influence the economic decision of users taken on the basis of the financial statements." Based on this definition and the following ratios‚ we believe Molex did in fact misstate the Balance Sheet and Income Statements for the period ending in June of 2004. In September‚ prior to making these errors public information‚ Molex released its yearly financials
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False Difficulty: Medium Multiple Choice Questions 11. A CPA issued an unqualified opinion on the financial statements of a company that sold common stock in a public offering subject to the Securities Act of 1933. Based on a misstatement in the financial statements‚ the CPA is being sued by an investor who purchased shares
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revenues exist‚ are complete‚ and are accurate. Procedures To test the reasonableness of sleeping room revenues‚ B&J: 1. Identified the key factors‚ key relationships and other considerations that drive sleeping room revenues 2. Determined tolerable misstatement based on assessment of inherent and internal control risks 3. Set and corroborated expectations 4. Compared client actual amounts to expectations and evaluated results 5. Assessed the need for additional tests of details Results & Conclusion 1
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