TABLE OF CONENTS INTRODUCTION PG 1 COMPANY EVALUATION PG 2 COMPLIANCE AND RECOMMENDATION PG 4 SUMMARY / CONCLUSION PG 5 REFERENCES PG 6 Introduction The primary objective of Accounting Ink, is to provide LJB Company with the required information to consider the regulations for converting to a publicly traded company. Within this analysis we will identify internal controls currently being used within business operation and the required mandated internal controls enforced by the Sarbanes Oxley Act. Internal Controls are established and or regulated by the Sarbanes-Oxley Act. There are six principles of internal controls 1) Establishment of responsibility, 2) Segregation of Duties, 3) Documentation Procedures, 4) Physical Controls, 5) Independent Internal Verification and 6) Human Resource Controls (Keller, 2012). Companies and their independent accountants or auditors should report the effectiveness of the companies internal controls based on these six principles.
Hammersmith Tools Limited The underlying accounting policies have been applied in the preparation of the financial statements of Hammersmith Tools Ltd. Statement of Accounting Policies For the Year ending 31 December 2011 1. Purpose The purpose of the following statement of Accounting policies is to act as a guide to non-accounting employees on basic accounting procedures that are employed in the company while determining the overall profits of the company. 2. Basis of Preparation The financial statements are prepared in accordance with the applicable law and under the convention of Historical cost.
General and Commercial Basis Accounting Principles Generally accepted accounting principles (GAAP) state the standard framework of guidelines for financial accounting used in any given jurisdiction; commonly known as standard accounting practice or accounting standards. These contain the rules, standards, and conventions that accountants practice in recording, summarizing and in the preparation of financial statements. Hubpages.com discusses commercial accounting, also known as profit accounting, defining that it performs mainly by profit and loss. The reporting for a profit organization is directed to the investors. ("The Principles of Commercial Accounting and Fund Accounting", 2011).
Data sourced ... Historical financial statement Historical financial statement BDO Seidman BDO Seidman 2). Documentation with its customer regarding its orders 3). Its credit and bad debt write-off policy 3. Non-financial factors the auditor should consider: 1).
LBJ Company | Analysis of the Internal Controls Systems for LBJ Company | Evaluation Report | | Table of Contents Introduction 2 Components of Internal Control 3 Internal Control Procedures 4 Going Public and the Sarbanes—Oxley Act of 2002(SOX) 7 Analyzing LBJ Internal Controls System 10 Conclusion 12 Citations 13 Introduction To the President of LBJ Company, We have evaluated the Internal Control systems adopted by LBJ Company in accordance with the standards generally accepted accounting principles in the United States of America, based on the information provided to us. To perform this evaluation we were asked to analyze the effectiveness of LBJ’s internal control. Therefore, we have completed a list of its strength points and weakness points, providing recommendations for improving the deficiencies founded. Another point that was required from us was to provide information of any new regulations the company will need to implement in order to go public. To begin with this report we will first provide the description of the term Internal Controls, what it consists of, its components and procedures.
FASB Codification System The Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants (AICPA) recognizes the Financial Accounting Standards Board (FASB) as an authoritative organization since 1973 (Facts about FASB, n.d.). The FASB is an organization designed to establish standards for financial accounting that oversee the preparation of all financial reports by any nongovernmental entity. The FASB has designed the Accounting Standards Codification to assist with the assembling a localized location to search authoritative resources regarding accounting standards. FASB Codification System and Its Purpose The FASB Codification system is defined by the FASB as, “a database and research system developed by the Financial Accounting Standards Board (FASB) that pulls together many of the authoritative resources about accounting standards into a single, searchable system” (Financial Accounting Standards Board, n.d.). The purpose of the FASB Codification is to allow accounting and reporting professionals access to an online database that makes finding and navigating through authoritative accounting standards simpler and easier.
The general accepted accounting principles regulate and standardize preparation of financial reports which are distributed to the public. Companies are required to comply with GAAP when presenting external financial reports (Kieso, D. E., Weygandt, J. J., & Warfield, T. D, 2007). An accrual basis accounting system is different from just tracking incoming and
Since then, the FASB has been the designated organization in the private sector for establishing the standards of financial accounting. These standards govern the preparation of financial reports by nongovernmental entities. They are officially recognized as authoritative by the Securities and Exchange Commission (SEC) and the American Institute of Certified Public Accountants (AICPA) to establish financial accounting and reporting standards for publicly
Each facet has its own qualifications and certifications. If a person is looking to become a personal financial planner, what are the credentials required? First, look at the educational requirements. Of course, one must first receive a bachelor's degree in accounting. This degree at Ashford University includes such aspects as principles of accounting, statistics, principles of finance, business law, federal income taxes, and auditing.
The Financial Accounting Standards Board (FASB) started in 1973 to provide standards for private sector companies to prepare their financial statements. The Securities and Exchange Commission (SEC) recognizes the standards given by the FASB as authoritative as long as the FASB fully acts in public interest. FASB standards are used by companies in the United States and IASB standards are used for companies in other areas of the world (Schroeder, Clark, & Cathey, 2011). The International Accounting Standards Board (IASB) was formed in 2001 to promote the use of international accounting standards. The IASB was formed to replace the IASC.