Financial Audit and Laramie Wire Manufacturing

This course is the first in a two-part series that deals with auditing a company 's financial reports, internal controls, and

NOTE: In addition to the in-chapter and end-of-chapter exercises which serve as short cases you will find the following short cases arranged by course title that can also be utilized as short cases that require the student to access the authoritative literature to address the issue presented in the case. Solutions to the cases below are available to instructors on the Weirich Accounting & Auditing Research 8e instructor website at www.wiley.com/college/weirich. Other excellent sources of longer and more detailed cases include the Deloitte Trueblood cases and cases provided by various other firms.

CAS 300 requires auditors to their audit using a risk based model where the nature, timing and extent of audit procedures are based on the assessed risk of material misstatement. Pickett (2006) argues that for audits to be effective and efficient, much of the audit effort should be focused on areas that are considered to pose the highest audit risk. Additional audit procedures should be linked to individual audit assertions whereas other audit procedures need to be performed as and when needed. Thus, for an audit plan to be put in place, it is necessary for an auditor to come up with a risk profile of the client comprising an understanding of the business operating by the audit client, assess business risk and also perform its preliminary analytical review.

Student Cases with Solutions to accompany Accounting & Auditing Research: Tools & Strategies (7th edition)

Read the Zoom Snowboard case (on Canvas). Please stop at page 1205 …just glance through page 1206. Then, please complete the template below. This audit planning case is worth 5% of your grade. It requires you to be familiar with Chapters 6, 8 and 9.

|Develop Audit programs for the substantive audit procedures for the balance sheet and income statement |35 |

During the planning phase of the audit, you met with Pinnacle’s management team and performed other planning activities. You encounter the following situations that you believe may be relevant to the audit:

2. Identify and briefly describe the specific fraud risk factors present during the 2000 NextCard audit. How should these factors have affected the planning and execution of the engagement?

On numerous occasions Jessica has accepted instruction and the instruction from the Senior Internal Auditor to explore specific risks in a process, to gather information regarding process, to explore controls, develop and perform audit testing, to develop root causes, and create action plans. These direction have led to larger scope audits or changing the scope of audits based on the information. Jessica did not hasted in the acceptance of the expanded scope of audits or the change in scope of audit. She has accepted the instruction and went out of her way to ensure there timely completion. Examples includes:

Wool is ordered into the particular gatherings. By this arrangement, processors can choose the accurate item which they need to process, and pay the ranchers as indicated by the quality and sort of fleece.

Detroit’s production is unique when compared to other Wriston plants. Runs are typically low volume, involve higher set up time than run time and vary significantly due to the sheer volume of different product lines,

Inventory will include 304 sheet metal, industrial powder coating paint in all ROYGBIV colors, and cardboard packing with zipties. This is inventory is a combination of raw materials, supplies and, after production will contain, finished goods. Inventory stock will be very low investment as an estimated ¢14 per-unit is what it would cost for a collegiate keychain to sit on out stick shelf. There would be a seasonal buildup during the fall and a slump in the spring. Lead times in ordering should only take two weeks for even the more large of orders placed since production can also

Analysing materials in vital to monitoring the effective and efficiency of operations. It gives managers, investors, and employees an opportunity to make adjustments to meet objectives of a scope. In addition, well-structured approach is just as essential for a successful evaluation. Therefore, a ABC classification system can help analysis material. ABC classification system is the ranking of materials (inventory). ABC can be applied a number of ways, which are material criticality and material dollar volume. The idea is to complete what is the most important rank over what is less important. The value of ABC analysis to retailers is important because retailers sort materials for resale based on the quality of products and

This part presents the data describing the product, the production process, the equipment, resource requirements, and machineries to be used together with the raw materials for the products, floor plan of the business, location, facilities, utility cost, production cost, and prices of the product.

Balancing these requirements leads to optimal inventory levels, which is an on-going process as the business & have impact of Global market trends with Auto Industry getting Global. Major tools used for inventory reviews include ABC analysis, Cycle County. Perpetual inventory, etc.