Internal auditors guarantee that the internal controls are sufficient and calculate the company’s financial and information systems for accurateness. A series of audits such as financial statements, fraud, compliance, and operational can be made with the hiring of an internal auditor. The most beneficial audit for Whitfields Company would be an operational audit. Operational Audits can be done if upper-level management thinks that there is a need for operational improvements. It is a review of management and how operating procedures work.
Under Section 404 of the act, these findings must detail any uncovered control deficiencies or instances of employee fraud, and must also be reviewed and attested by the registered accounting firm. The authors of the report must certify that the report does not contain any false information, misleading statements or significant omissions, and that the financial statements and information included in the report accurately represent the financial condition of the company. Under Section 401 of the act, this representation must account for both balance and off-balance sheet debts, obligations and transactions in order to facilitate maximum transparency for shareholders (Nikolas, Daniel. Nd Effects of the Sarbanes-Oxley Act). The act serves as a guideline and governs what an accountant should and should not do when reporting financial flows.
True (f) The objective of financial reporting is the foundation from which the other aspects of the framework logically result. True E2-4 Instructions Identify the appropriate qualitative characteristic(s) to be used given the information provided below. (a) Qualitative characteristic being employed when companies in the same industry are using the same accounting principles. Comparability (b) Quality of information that confirms users’ earlier expectations. Confirmatory value (c) Imperative for providing comparisons of a company from period to period.
The purpose of the financial statement audit is to ensure the entity being audited is preparing the financial statements in conformance with General Accepted Accounting Principles (GAAP). The information is important to investors, managers, banks,
Internal Controls XACC/280 October 7, 2012 Vaunda Davis Internal Controls Internal control is the process designed to ensure reliable financial reporting, effective and efficient operations, and compliance with applicable laws and regulations. Internal Controls are needed to ensure the proper account of revenue under the guidelines of GAAP .These controls are aimed at ensuring compliance with revenue recognition guidelines and safeguarding assets against theft and unauthorized use, acquisition, or disposal is also part of internal control. There are six principles of internal controls. These control principles establish responsibility, using physical, mechanical, and electronic controls; segregate duties, and perform independent internal
Reporting Practices and Ethics Paper Sharon Tucker HCS/405 May 13, 2013 Elizabeth Caissie Abstract The implementation of financial reporting and ethical standards are crucial for the growth and progression of an organization. Reporting fairly and accurate data will help control measurements that may address theft and/or fraud within the structure. Ethical standards are vital for the development in an organization’s set rules and policies in having quality in the services provided including integrity, values, and delivering effective outcomes in honesty. Generally accepted accounting principles (GAAP) are set guidelines which indicate rules, regulations, and procedures that are implemented for the maintenance and/or monitoring records. An organization that provides a financial statement to the public, investors or government funding entities must follow the set standards developed by Financial Accounting standards Board (FASB).
Depending on the results of the evaluation, __ Auditing should guarantee that Apollo Shoes, Incorporated has adequate internal control over financial statements. __ Auditing Firm’s has observed financial statements by anglicizing the validity of the supporting documents. The disclosures notes attached to the financial statements have given __ Auditing a comprehensive assessment of the manager’s decision making process. The important assessment of the financial statement was to evaluate Apollo Shoes, Inc. financial strength and whether the organization badly stated any financial reports to the shareholders or consumers. The evaluation of the organization usefulness of the internal control, and provides very important information of the organizations achievement habits in the economy.
Adhering to compliance is crucial to prevent companies from failing and taking huge financial loses. McBride must implement a system of audit compliance committees that will help mitigate non-compliance. Audit compliance committees will review financial documents, including receipts, documents, stocks, trades, shares, investment numbers and any other financial documentation. Non-compliance includes behavior and unethical actions performed by senior management that will be audited and monitored by the compliance committee. The committee will consist of internal and external auditors who will each have a part in ensuring McBride continues to perform and service the needs of customers
The outflows of a business will be discussedfurther and how to control the risks that areinvolvedwith different areas. The controls that will be addressed will involve the areas of purchasing, accounts payable, cash disbursements, finance, investments, and payroll. Each area will consider the different transactions that take place and how internal controls can assist in reducing fraud and poor decision making. Purchasing The purchasing department in a company allows a certain amount of power to the employees whowork in that department. Controls need to be in place to prevent fraud and error from occurring.
The audit for the financial statements will include evidence supporting amounts and disclosures in statements, examining, accounting principles used assessment, estimates made by management, evaluating all of the financial statements overall. The internal control over financial reporting audit will be acquiring an understanding of internal control over financial reporting, evaluating and testing the design and operation of the effectiveness of internal control and conducting procedures as necessary. The internal control over financial reporting within a company is meant to provide a reasonable assurance as to the reliability of financial reporting and for the preparation of the financial statements for external purposes in accordance to the generally accepted accounting principles