Finally, the test of controls for the posting and summarization objective will be to examine evidence that the accounts receivable master file is reconciled to the general ledger and observe whether monthly statements are sent to customers. Transaction-Related Audit Objectives Key Internal Controls Tests of Controls Substantive Tests of Transactions Recorded sales transactions are accurate. Sales and amounts are internally verified for description of the order and quantity. Examine indication of internal verification Compare recorded transitions in the sales acquisitions journal with the vendor’s invoice, receiving report, and other supporting documents. Sales invoices, shipping documents, and sales orders are pre-numbered for Apollo.
The accounts are assessed base in accordance with the generally accepted accounting principles (GAAP) to ensure they are represented fairly. Tests of Controls The test of controls purpose for the acquisition and payments cycle is for the detection of understatements. Tests of controls for this cycle would include: 1. Verify that correct documents (purchase order, purchase requisition and vendor’s invoice) are prepared and attached to the voucher and examined for existence when submitted to appropriate departments. 2.
“LJB Company…Headed in the right direction” Carl R. Smith Acct 504- Professor Wibbert 2-9-2014 1. To the LJB President: I would like to personally thank you for allowing my accounting firm to evaluate your company’s internal controls system. In my report you will be informed of any new internal control requirements required for LJB to go public as well as inform you of what your company is doing right and make any suggestions on what the company can do to get better. The interest of the company going public will be a very successful decision. Some tests have to be properly administered to do so.
This is not a letter of agreement, but more for educational purposes. The Process of Auditing A review and examination of a company’s financial statements is an audit. When the examination has been performed the auditor is able to express an opinion in regards to a companies financial statements, if they are fair representations or not. Audits are conducted and properly executed in compliance with all laws and regulations. WTF will outline the process in which we will be conducting the audit.
GAAP cover such things as revenue recognition, balance sheet item classification and outstanding share measurements. Companies are expected to follow GAAP rules when reporting their financial data via financial statements. If a financial statement is not prepared using GAAP principles, be very wary! Therefore, you still need to be careful and review other financial reports which can be altered. Convergence means that the U.S. Financial Accounting Standards Board (FASB) and the Independent Accounting Standard-setting Body (IASB) would continue working together to develop high quality, compatible accounting standards over time.
The FASB Accounting Standards Codification (FASB Codification) is the only source of authoritative GAAP apart from SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an Accounting Standards Update to inform people about changes to the FASB Codification, which includes changes to non-authoritative SEC content. In relation to International Financial Reporting Standards (IFRS), after a new IFRS Standard is issued and before it becomes effective, the International Accounting Standards Board (IASB) helps stakeholders to understand the new Standard's principles very well. The activities of the board promote greater consistency in stakeholders' understanding of new Standards as the practice develops, which supports
dyKeller Graduate School of Management of DeVry University The LJB Internal Control: Review and Recommendations by Dmitry Simakovich Professor Marsh, Malinda Accounting and Finance: Managerial Use and Analysis October 7, 2012 Table of Contents Introduction............................................................................................................3 I. New internal control requirements.........................................................................4 II. Positive steps have been made by a company to goal........................................ 6 III. Recommendation for improving of the internal control........................................ 6 Summary and Conclusion......................................................................................9 Works cited..........................................................................................................10 October 7th, 2012 To: President of LJB Company From: Dmitry Simakovich, SD Consulting LLC Topic: The LJB Internal Control: Review and Recommendations Mr. President. We would like to congratulate you for your decision to take LJB public.
The board of directors is responsible for overseeing and exercising corporate powers and certifying the company’s business affairs while managing the goals and objectives for long-term interests of the shareholders. Organizational Annual Report and SEC Filing The SEC requires publically traded companies to file annual financial reports, and these reports are open to the public. Investors are interested in these reports because it helps in determining the financial health of a company. As a means for providing guidelines, principles, and objectives for the financial markets in the United States, the Sarbanes-Oxley Act of 2002 enhances the SEC’s roles for reforming corporate accountability. This also includes establishing a private-sector regulator to oversee the auditing profession to combat accounting fraud, and enhancing financial disclosures.
This financial analysis has been done on the basis of annual reports of the company from year 2001 to year 2013. The software used to analyze results is Microsoft Excel. Plus, the secondary data has also play a vital role while writing this case. Furthermore, this research can be help full for other academic courses of marketing, management, investment, expansion and leadership. Wal-Mart was founded by Sam Walton in 1962.
I will be using their annual report from 2011, and explain the main sections of the report, discuss key factors that helped influence the company’s financial performance for the year stated above, the company’s assets, and we will also explain how management characterizes the internal control environment. Annual reports for a company are usually divided into sections to separate different topics or ideas. In the annual report for eBay, the main sections that are spoken about are the business section, legal proceedings, selected financial data, market for related stockholder matters and issuer purchaser equity. The business section of the annual report basically tells exactly what the business is. It informs the reader on when the business was founded, who founded it, what products and services the business offers, and how many customers have used their business.