ISSUES IN ACCOUNTING EDUCATION Vol. 23, No. 2 May 2008 pp. 299–307 Assessing Audit and Business Risks at Toy Central Corporation Christine E. Earley and Fred Phillips INTRODUCTION [pic]s a senior in a professional services firm, you have been assigned to plan the financial statement audit of a private company named Toy Central Corporation (TCC). In addition, the partner on the engagement has asked you to identify business risks that could adversely affect TCC’s sustained profitability, so that they can be brought to the attention of the company’s board of directors. These tasks will require you to draw on your knowledge of supply chain management, marketing, internal controls, audit assertions, and financial accounting. …show more content…
As a private company, TCC is not directly affected by the Sarbanes-Oxley Act (SOX). However, the partner in charge of the engagement has advised you that, ever since the financial scandals at the turn of the century, TCC has become interested in strengthening its corporate governance. Two years ago, following the release of the AICPA’s Audit Committees Toolkit for public and private corporations, TCC has asked your firm to consider not only financial reporting issues, but also significant business risks that could affect the sustainability of TCC’s success in the toy industry. Although TCC’s board of directors believes it is aware of strategic issues facing the company, it has been considering spinning off its digital toy division into a separate company and, subsequently, merging it with an upstart software company. Before embarking on a change in organizational structure, the board wants a ‘‘second set of eyes’’ to ensure it has considered all significant business risks that currently exist and could adversely affect TCC in the foreseeable future. TCC’s audit committee is meeting in two weeks and would like the partner to explain significant business risks identified during KDOK’s interim audit tests and the year-end audit planning. The partner would like you to prepare an audit planning memorandum that
|b. |attempts to satisfy the costing objectives of both financial accounting and management accounting. |
California Surf Clothing Company issues 1,300 shares of $7 par value common stock at $22 per share. Later in the year, the company decides to repurchase 130 shares at a cost of $35 per share.
Xilinx, Inc. designs, develops, and markets complete programmable logic solutions, including advanced integrated circuits, software design tools, predefined system functions delivered as intellectual property cores, customer training, field engineering and technical support. Customers are electronic equipment manufacturers primarily in the telecommunications, networking, computing, industrial, and consumer markets. Products are sold globally through a direct sales management organization and through franchised domestic and foreign distributors. (Source: Company 2007 Form 10-K)
3. What was the balance of Walmart’s allowance for doubtful accounts (ADA) as of January 31, 2012?
There are four stages in this audit. The first stage is the planning and risk assessment. This stage of the audit is completed during the initial planning. The risks for Smackey Dog Foods, Inc. can be better identified by understanding the business, its industry, environment, management culture, the type of accounting used, and the competition. The auditors should be able to understand why Smackey’s sales are steadily increasing and its competitors sales are declining. To be more specific, the implementation and design of Smackey’s internal control procedures, processes, and systems are studied and analyzed for the audit team to be able to assess the control risk for each of the transaction related audit objectives, which are accuracy, occurrence, classification, completeness, summarization, and timing and posting.
347 U.S. 483 Argued December 9, 1952 Reargued December 8, 1953 Decided May 17, 1954 APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF KANSAS* Syllabus Segregation of white and Negro children in the public schools of a State solely on the basis of race, pursuant to state laws permitting or requiring such segregation, denies to Negro children the equal protection of the laws guaranteed by the Fourteenth Amendment -- even though the physical facilities and other "tangible" factors of white and Negro schools may be equal. (a) The history of the Fourteenth Amendment is inconclusive as to its intended effect on public education. (b) The
Homework These problems are not in My Accounting Lab. They can be found in the Textbook Material beginning on page 379. Complete homework using Excel or PDF Working papers (below). Check your work against the homework solutions (below). Turn in your printed homework in class. Practice Problems: Quick Check #1-10 Assigned Problems: E7-13, 19, 20, P7-26A, P7-28A (14 points) Extra Credit: P7-29A (2 points)
Prior to the advent of the Sarbanes-Oxley Act of 2002, referred to herein as “SOX,” the board of directors’ pivotal role was to advise senior leaders on the organization’s strategy, business model, and succession planning (Larcker, 2011, p. 3). Additionally, the board had the responsibility for risk management identification and risk mitigation oversight, determining executive benefits, and approval of significant acquisitions (Larcker, 2011, p. 3). Furthermore, for many public organizations, audit committees existed before SOX and provided oversight of internal processes and controls. Melissa Maleske (2012) advised that the roles and responsibilities of the board were viewed “…from a perspective that the board serves management” (p. 2). In contrast, Maleske (2012) noted that SOX regulations altered the landscape “…to a perspective that management is working for the board” (p. 2). SOX expanded not only the duties of the board and the audit committee, but also the authority of these bodies (Maleske, 2012, p. 2).
|Selling Price per|Year 1 Sales Units |Year 1 Year End Stock units |Year 2 Unit Sales |Sales Revenue Year 1 |
[pic]s a senior in a professional services firm, you have been assigned to plan the financial statement audit of a private company named Toy Central Corporation (TCC). In addition, the partner on the engagement has asked you to identify business risks that could adversely affect TCC’s sustained profitability, so that they can be brought to the attention of the company’s board of directors. These tasks will require you to draw on your knowledge of supply chain management, marketing, internal controls, audit assertions, and financial accounting.
19. The accounting assumption that requires every business to be accounted for separately from other business entities, including its owner or owners is known as the:
Although the Sarbanes-Oxley (SOX) Act comes with many different benefits, the Act itself still consists of any major pros and cons. The SOX Act must review what needed to fix or changed due to the unfair to small companies. Therefore, it should be considering making improvements to other areas to ensures fair practices. Like many major businesses guidelines, the SOX Act should do its part to push to prevent conflict of interest. Although it has made significant improvement on the reliability of financial reporting for public traded companies and helping investors in today business world. It still need to assures the auditing process is fair and consistent to tighten the awareness of unethical practices. The SOX Act has already put major company
The study of introductory accounting is relevant only to those who intend to pursue a career in professional
Table of Contents ................................................................................................................................................ 1 Assignment Background .................................................................................................................................. 2 Bigg-Glowbell Overview ...................................................................................................................................... 3 The Company History ...................................................................................................................................... 3
The accounting issue at hand in this case is revenue. Landline is offering call routing services for PRU and the former entity has to make some receipts from the services rendered. To put the issue at hand in context, revenue is generally the income received by any company from selling goods or services. In abroad sense, revenue is the income received by any commercial institution for the goods sold or services rendered. It is basically the incoming receipts generated from the services offered or goods sold. It is the core parameter of consideration in the event of evaluating the company’s health. There are two classifications of revenue and the situation in which Landline is requires serious