Financial accountants and independent auditors commonly face challenges Abstract Financial accountants and independent auditors commonly face challenging technical and ethical dilemmas while carrying out their professional responsibilities. This case profiles an accounting and financial reporting fraud orchestrated by the chief financial officer (CFO) of a major public company and his subordinates. The CFO‚ who was a CPA‚ took extreme measures to conceal the fraud from his company’s audit
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North Face‚ Inc. 1. Should auditors insist that their clients accept all proposed audit adjustments‚ even those that have an "immaterial" effect on the given financial statements? Define your answer. I think auditors should strongly insist that their proposed adjustments should be made. If the company makes the proposed adjustments‚ it would seem to allow for a lesser probability for misstatements to occur. Even though an adjustment may seem immaterial for one year’s statements‚ a combination
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Case 5.3 The North Face‚ Inc 1 Auditors should not insist that their clients accept all proposed audit adjustments even those that have an “immaterial” effect on the given set of financial statements. Because “immaterial” effect on the financial statements will not affect the users’ decisions. Therefore‚ auditors have to confirm if the effects on the financial statements are really “immaterial”. If there are really “immaterial”‚ sometimes the auditor would be forced by the clients to ignore it
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Sally Chin Monique Harper Marmeline Petion Eric Yaker Advanced Financial Analysis Final Group Project The North Face‚ Inc. December 5‚ 1999 Table of Content SECTION I Industry Analysis Overview Industry Trends Competitive Landscape 3 3 4 5 SECTION II Company Analysis Background Strategy-SWOT Analysis Strategy-Porter’s Five Forces 6 6 7 9 SECTION III Accounting Analysis Cash Flow Analysis Quality of Earnings Earnings Manipulation 10 10 10 11 SECTION IV Financial Analysis
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The North Face‚ Inc. - Individual Case Synopsis: The North Face‚ a company that has always found a way to sell their product to unique customer‚ didn’t get to where they are today easily. Presently owned by Vanity Fair‚ The North Face was started by Hap Klopp in the mid 1960s with the mission of providing a ready source of hiking and camping gear to customers. Today‚ they offer products ranging from outdoor chairs to backpacks. As the company began to grow‚ so did the goals set by management
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The North Face Inc. 1. The auditor should mainly insist their clients to make the proper adjustments towards material misstatements that have a direct effect on financail statements. In regards to immaterial items‚ the auditor should give the client suggestions on why they recommend for the client to make adjustments. And if the client disagrees with the adjustments they probably have a logical reason for why they don’t want to make the adjustments. And the auditor should respect the clients decision
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1. Should auditors insist that their clients accept all proposed audit adjustments‚ even those that have an “immaterial” effect on the given financial statements? Defend your answer. The auditors should not insist that their clients accept all proposed audit adjustments. The auditor’s main duty is to provide reasonable assurance to verify the accuracy and compliance of client’s financial statements‚ to ensure that it conveys data and information of events occurred within the accounting period
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Lukas Nelson Knapp Case 1.9 Dr. Noland 2/25/13 1. Both a review and an audit are attestation services performed by a CPA‚ however an audit has a high level of assurance that comes with it‚ telling external users of financial statements that they are sound. A review should not be relied upon as heavily as an audit when making decisions about a company because a review does not require the same level of assurance. 2. The restoration sights that were visited by the auditors were determined
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The brand is distributed in North and South America‚ Europe and Asia. Is the company looking to investigate their decline in sales in North America alone? Or should the research expand to their international branches? 2. In the past year e-commerce sales has increased by 16% making up 8.1% of the total retail market. In addition to visiting brick and mortar sporting goods store should I also look into how the online sales account for the total retail sales of North Face? 3. Aside from selling their
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clients would refuse to propose audit adjustments. 1. Discuss the general principles or guidelines that dictate when companies are entitled to record revenue and how the $7.8 million barter transaction and the two consignment sales discussed in the case may have violated these principles. . Revenues and gains are realized when products (goods or services)‚ merchandise‚ or other assets are exchanged for cash or claims to cash revenues are considered to have been earned when the
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