North Face Inc. Case Study Essay

Give an example of how each of these specifically applies to the Smackey Dog Food, Inc audit. For instance, examine the apparent internal control weaknesses and possible negative outcome of each.

The auditor must remember that all information collected during the audit needs to be sufficient enough to further the audit process. The information must not only possess the two qualities, relevance and reliability, but it should also test various assertions. For instance, in the audit of Walmart, the auditor should make an attempt to acquire information such as financial statements from the company’s bank, as opposed to acquiring the statements from Walmart’s management. Taking such crucial information from Walmart’s management will put the reliability of that information into question. It is possible that management may manipulate the financial statements, so that they are more appealing to the public and investors. Management may do things

Target Corporation’s (NYSE:TGT) share price declined nearly 7.5% in the last month alone, amid the potential threat of higher taxes from Donald Trump’s new administration. Aside from higher taxes, the company looks in a very solid position to expand its profitability and dividends.

According to an article in the CPA Journal, the accounting profession has long contended that an audit conducted in accordance with generally accepted auditing standards (GAAS) provides reasonable assurance that there are no material misstatements contained within financial statements. Suggest at least two (2) alternative methods that auditors can use to provide a more concrete level of assurance to investors. Provide support for your responses with examples of such methods in use.

The CPA firm should not issue an unqualified opinion based on these circumstances. The unpaid accounting fees may cause the CPA firm to have doubts about the client’s ability and willingness to pay for its services. As a result, the CPA firm’s judgment may be influenced by these doubts, and it may not be able to properly evaluate the client during the audit in a manner that is unbiased and impartial. Instead, the CPA firm should issue a qualified opinion that discloses the potential lack of independence caused by the past due billing. It is essential for CPAs to follow the standards of independence so that they maintain a reputation of integrity among the public (Dodaro, 2013).

• Audit documentation is used by the successor auditor when reviewing the predecessor auditor’s work. The successor auditor will review the previous year’s audit documentation to help gain a better understanding of the business, to identify any high risk areas that might affect acceptable level of risk, and to assist in planning the audit. Without this documentation it would be difficult for the successor auditor to achieve these goals.

Determine which facets of the GEICO total rewards program align with the five (5) top advantages of a total rewards program outlined in Chapter 2 of the textbook and discuss your reasoning.

A) The annual audit of Midwestern Manufacturing revealed that sales were accidentally being recorded as revenue when the goods were ordered, instead of when they were shipped. Assuming the amount in question is material and the client is unwilling to correct the error, the CPA should issue:

Ignoring the revenue recognition principle could end up distorting an entity's balance sheet/statement of financial position. It is important to note that without adherence to this principle, it could be possible for entities experiencing a decline in sales to hide such an occurrence by modifying some items. In such a case, a refundable cash inflow i.e. a deposit used as security for the possible completion of an agreed upon task at a specified future time could be recognized as revenue. Under this principle, such an inflow should ideally be recognized as a liability and later as revenue only after the said task has been completed.

United Way, formerly known as United Way of America, and also linked to United Way Worldwide).

d. “The auditor's reliance on substantive tests to achieve an audit objective related to a particular assertion may be derived from tests of details, from analytical procedures, or from a combination of both. The decision about which procedure or procedures to use to achieve a particular audit objective is based on the auditor's judgment on the expected effectiveness and efficiency of the available procedures. For significant risks of material misstatement, it is unlikely that audit evidence obtained from substantive analytical procedures alone will be sufficient (PCAOB, AS 2305.09).”

Canadian based company, Saralyn Mills, is in need of a new marketing strategy to repair the current shortage of sales in Quebec, Canada. According to the case study, the Quebec and Ontario markets account for 69 percent of the company’s sales in Canada. Currently, Saralyn Mills does not have an effective strategy in place for the market of Quebec. The company’s current goal is to implement a global standardization strategy, which is focused on keeping a set marketing strategy the same for every location. It is up to the marketing manager, Nicole Vichon, to come up with a new and separate marketing plan for Quebec. Even though this would be a major policy change from the current global strategy of Saralyn Mills, case facts prove it could be very effective.

Analysis: The North Face chose the fabric contains recycled polyester and polyester with durable water-repellent finish that helps the shell fabric resist wetting by causing the water to bead-up so it easily falls off before being absorbed into the fabric. The Heatseeker™ keeps wearers warm without the bulk. Champion’s vest has more garment details, such as inner wind flat and locker loop. It is made of 100% polyester featherweight fabric that is water resistant. It helps keep wearers dry and comfortable. The vest also has the DWR finish for wind and water resistant.

1. Materiality is one of the most controversial topics in accounting due to its subjective nature. Auditors must gather data and decide whether the adjustments in question would have a material affect on a financial statement. A large number of inaccurate transactions that are determined immaterial could easily add up and over time, create significant misstatements, so the aggregate effect must be taken into consideration. Audits should be completed as early as possible, so management cannot use time constraint as an excuse to forego making the adjustments. In regards to the North Face case, Deloitte used a dollar amount threshold of $800,000 as a guideline to assess materiality. The level of materiality should be compared to the size of

Auditors don 't particularly favor to turn down current or prospective clients, especially when they own stock % in the company or if it is well-known company like Shell however being worried about their reputation and future works, they try not to audit dishonest clients, because it can have dire consequences for the auditor. In the case if auditor becomes involved with bad clients, it is necessary to weigh revenues earned from desirable clients against potential problems.