Assignment: US Surgical Case Essay

1483 WordsJan 28, 20126 Pages
Case Study: The US Surgical Case: 1. Identify audit procedures that, if employed by Ernst & Whinney during the 1981USSC audit, might have detected the overstatement of the leased and loaned assets account that resulted from the improper accounting for assets retirements. There are several audit procedures that, if employed by Ernst & Whinney during the 1981 USSC audit, might have detected the overstatement of the leased and loaned assets account that resulted from the improper accounting for assets retirements. First of all, Ernst & Whinney overlooked an important risk factor of the company’s strong incentive to reach targeted sales and profit goals. In addition, they failed to properly apply analytical…show more content…
Property, Plant, And Equipment: | | | | | | | Land | | | 1.2% | | 2.0% | | 1.5% | | Buildings | | 15.6% | | 15.5% | | 18.5% | | Molds and Dies | | 15.5% | | 13.4% | | 12.4% | | Machinery and Equipment | 19.4% | | 20.0% | | 17.5% | | | | | | 51.7% | | 50.9% | | 49.9% | | Allowance For Depreciation | -7.2% | | -8.4% | | -9.0% | | | | | | 44.5% | | 42.5% | | 40.9% | Other Assets | | 7.1% | | 3.2% | | 3.5% | | | Total Assets | | 100.0% | | 100.0% | | 100.0% | | | | | | | | | | | Current Liabilities: | | | | | | | | Accounts Payable | | 5.9% | | 5.8% | | 8.9% | | Notes Payable | | 0.0% | | 0.0% | | 2.3% | | Income Taxes Payable | 0.0% | | 1.4% | | 0.0% | | Current Portion of Long- | | | | | | | | Term Debt | | 0.3% | | 0.6% | | 0.6% | | Accrued Expenses | | 2.7% | | 4.3% | | 7.3% | | | Total Current Liabilities | 9.0% | | 12.1% | | 19.0% | | | | | | | | | | | Long-Term Debt | | 38.9% | | 39.9% | | 47.5% | Deferred Income Taxes | | 3.6% | | 2.5% | | 2.0% | | | | | | | | | | | Stockholders' Equity: | | | | | | | | Common Stock | | 0.5% | | 0.8% | | 0.5% | | Additional Paid-in Capital | 35.0% | | 29.3% | | 15.2% | | Retained Earnings | | 15.8% | | 17.5% | | 18.7% | | Translation Allowance | -0.5% | | 0.0% | | 0.0% | | Deferred Compensation – from | | | | | | | | Issuance of
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