1. Why would the owners of Lakeside‚ as well as the company’s banks‚ require that an annual audit may be made by an independent CPA firm? Auditing in general‚ is necessary because of the existence of Information risk or the risk of unreliable information. Owners of lakeside may own the company but they are not closely involved in managing the business with the exception of Rogers‚ the only owner involved actively in the business’ day to day operations. So‚ an independent audit for non-managing owners
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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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Arnold Abramson and Company is a regional accounting firm‚ with offices in Michigan and northern Wisconsin. It was founded in 1934 to provide auditing and tax services and‚ despite the depression‚ was immediately successful due to the economic growth of the area. The southern of¬fices of Arnold Abramson and Company‚ in Flint and Detroit‚ competed directly with the large‚ national CPA firms‚ the "Big Five." They were able to operate successfully until the mid-1960s by providing more personalized services
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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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Auditing a Publicly Traded Company Share-based compensation are avenues used to give employees equity rights into a company. There are two types: stock options and restricted stock. The reasoning for employees to have share-based benefits‚ according to Basu (2014)‚ “is that if they all have a stake in the value of the company’s shares‚ they may try harder to drive sales‚ profits and other financial metrics that investors and research analysts look for in stocks” (para. 1). One of the main disadvantages
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process. Lakeside funeral home is located in Woodstock‚ Ontario. This funeral home offers pre planning services. Their website is full of information on the importance of preplanning and having a service. It states that those who plan ahead can be assured that‚ not only will their personal wishes be fulfilled‚ but other unnecessary difficulties will be avoided. There are a variety of funeral service types and formats offered by this home. Cremation on site is an option as well. Lakeside funeral home
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Rogers Cable: First Time Right Program CASE STUDY ANSWER GUIDELINE A. Defining the Issue(s): -Eliminate the repeat effort currently required to successfully install and service customers during the 1st visit by Rogers Cable service technicians. B. Analyzing Case Data: (Option One) -1993 Canadian Telecommunication Act 1993 opened competition. -Cable companies have typically focused on growing rapidly. -Establishing a large subscriber base is key for pay-off to high investment cost
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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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CONSULTANT(S): CONSULTING FIRM: CASE: Rogers’ Chocolates PROBLEM: The Board of Directors have given direction to the new President‚ Mr. Steve Parkhill‚ to triple the size of the company within ten years. Mr. Parkhill is required to devise a strategy that would fit the company’s culture‚ and then gain the support of the board‚ the management team and the employees. SWOT ANALYSIS: Strengths Well-known Product Recognized since 1885 Good Reputation Amongst Customers Established Marketing
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investors’ next step was to sue the auditors of Stanford Financial Group. BDO‚ the accounting firm that was responsible for auditing Stanford’s financial statements‚ is currently the target of a major lawsuit. BDO did not act in accordance with the responsibilities of an auditor and thus led to audit risk‚ lack of independence‚ and various violations of the PCAOB’s auditing standards regarding investment securities. BDO consistently issued unqualified reports when there were material misstatements
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