• Crazy Eddie
    ratios over the period of 1984 to 1987 would have resulted in red flags. Crazy Eddie’s change in assets between this period is one red flag that an auditor should have noticed. Short-term investments had a zero balance until 1986 when it dramatically increased to 21.1 and then dramatically increased again...
    Premium 2254 Words 6 Pages
  • 10 key ratio
    such differences could be troublesome for auditors of transatlantic entities containing parents or subsidiaries in each continent, where legal resource and allowable liability limits differ. the purpose of this article are to discuss the abandoing of interpretation 101-16/ describe some effects of...
    Premium 1426 Words 5 Pages
  • Compute Key Ratios F
    decreasing. How was Crazy Eddie receiving all this money if sales were down? Extremely high A/R turnover rates are and indicator of credit and collection policies that are too restrictive. 2. a) Falsification of inventory count sheets (reperformance) A corrective internal control measure to establish existence...
    Premium 898 Words 5 Pages
  • Crazy Eddie, Inc
    are and indicator of credit and collection policies that are too restrictive. "Where were the auditors?" was a question posed repeatedly by investors, creditors, and other interested parties when the public learned of the Crazy Eddie fraud. Being an auditor, to identify specific audit procedures that...
    Premium 1040 Words 3 Pages
  • Crazy Eddie Case
    during 1980s. Discuss how changes in an audit client’s industry should affect audit planning decisions. Relate this discussion to Crazy Eddie. 4. Explain what is implied by the term lowballing in an audit context. How can this practice potentially affect the quality of independent audit services...
    Premium 1471 Words 5 Pages
  • Crazy Eddie
    inventory? 3. How should changes in the audit client’s industry affect audit planning decisions, especially in relation to Crazy Eddie? 4. (a) What is implied by the term low-balling in an audit context? (b) How can this practice potentially affect the quality on independent audit services? ...
    Premium 3212 Words 12 Pages
  • Crazy Eddie
    salespeople to pressure the customers to buy product warranties. Many of the repair costs that Eddie paid under these warranties were recovered by the company from manufacturers that had issued factory warranties on the products (RED FLAG). As the firm began to grow, Eddie became a secondary supplier, purchasing...
    Premium 2605 Words 7 Pages
  • Crazy Eddie
    Crazy Eddie collapsed following allegations of extensive financial . wrongdoing by Antar and his associates. Shortly after a hostile takeover of the company in November 1987,the firm's new owners discovered that Crazy Eddie's inventory was overstated by more than $65 million. This inventory shortage had...
    Premium 4785 Words 15 Pages
  • Case 4.4 Waste Management
    industrial operations to curbside collection. This company had become synonymous with many different kinds of disposal services that allowed for the company to grow and grow with a solid base over the course of twenty-eight years. Finally in 1996, the company reported total assets of almost $20 billion with...
    Premium 3706 Words 11 Pages
  • Crazy Eddie
    inventory and this downward trend should have been a huge red flag. These red flags show a company who is losing market share because of the expansion of the electronics market in the late 1980’s. Analysis of key ratios continues the trend of red flags for an auditor. The first ratio that looks a bit...
    Premium 1942 Words 6 Pages
  • Waste Management
    accounting fraud and auditor legal liability c a S eS inc lu de d in t hiS Se ction 4 89 99 4.1 Enron Corporation and Andersen, LLP Analyzing the Fall of Two Giants . . . . . . . . . . . 4.2 Comptronix Corporation 4.3 Cendant Corporation . . . . . . . . . . . . . . . . . . . . . . ...
    Premium 33542 Words 104 Pages
  • Auditing
    present the audit risk model, which is used to determine the nature, timing, and extent of audit procedures. Describe the components of the model and discuss how changes in each component affect the auditor's need for evidence. The Audit Risk Model (ARM) is defined as: a. Inherent Risk is the auditor’s...
    Premium 3551 Words 11 Pages
  • Soloution to Vol 2 Appendix
    organizations. Identify complete name of each organization. History of Establishment of GAAP. Discuss CAP, APB, FASB, and related pronouncements. (AICPA adapted). Accounting Principles. Define accounting principles. Discuss sources of GAAP. (CMA adapted). Standard Setting. Describe why there is political action...
    Premium 7492 Words 24 Pages
  • Sarbanes Oxley Memo
    Trading (APT), Learning Team A would like to discuss the implications of the Sarbanes-Oxley (SOX) legislation. This memorandum provides a brief history of SOX¡¦s creation, explains the relationship amongst the FASB, SEC and PCAOB, describes the pros and cons of SOX, assesses the impacts of SOX, and lists...
    Premium 1426 Words 5 Pages
  • Audit - Solutions for Chapter 2
    corporate governance are the stockholders (owners), board of directors, audit committees, management, regulatory bodies, and both internal and external auditors. 2-2. In the past decade, all parties failed to a certain extent. For detailed analysis, see exhibit 2.2 in the chapter and repeated here: ...
    Premium 18085 Words 61 Pages
  • Evaluation of Comptronix Corporation: Identifying Inherent Risk and Control Risk Factors
    present the audit risk model, which is used to determine the nature, timing, and extent of audit procedures. Describe the components of the model and discuss how changes in each component affect the auditor’s need for evidence. The audit risk model is used to determine the nature, timing, and extent of...
    Premium 2653 Words 9 Pages
  • Contemporary Auditing
    to include, indicate if there are other course materials you would like to add, and click “submit.” A Custom Solutions editor will contact you to discuss the options you have selected and to confirm your order. This page intentionally left blank CONTEMPORARY R REAL ISSUES & CASES AUDITING MICHAEL...
    Premium 286111 Words 877 Pages
  • Auditing Cases
    Case 1.5 United States Surgical Corporation Case 1.6 The Fund of Funds, Ltd. Case 1.7 Crazy Eddie, Inc. Case 1.8 ZZZZ Best Company, Inc. Case 1.9 Gemstar-TV Guide International, Inc. Case 1.10 New Century Financial Corporation Case 1.11 1 Madoff Securities ...
    Premium 75128 Words 302 Pages
  • Corporate Governance
    Recommendations requires listed companies to “lay solid foundations for management and oversight.” a) Discuss what this principle means in relation to a company with which you are familiar (explain the company’s legal entity, industry and country). (12 marks) b) Discuss what is the point of having...
    Premium 2359 Words 8 Pages
  • Accounting Ethics
    fundamental issues that motivate interest in each of the main subjects of contemporary research. In addition to a general introduction to business ethics, individual volumes cover key ethical issues in management, marketing, finance, accounting, and computing. The books, which are complementary yet complete in...
    Premium 95067 Words 271 Pages