Toy Central Case

Based on the internal cost study, the costs of Geoffrey Doll and the specialty branded doll #106 changed drastically. There was no change in the costs of the cradle as the Springfield plant is very labor intensive. Below are the calculations for the total cost of each type of doll & the cradle:

In this task I’m going to analyse the figures on cash flow that I created in P3 and justify why you think the business might have problems also provide range of solutions.

This course focuses on ways in which financial statements reflect business operations and emphasizes use of financial statements in the decision-making process. The course encompasses all business forms and various sectors such as merchandising, manufacturing and service. Students make extensive use of spreadsheet applications to analyze accounting records and financial statements. Prerequisites: COMP100 and MATH114 / 4-4

#3. Inherent Risk Factors; audit planning decisions. Businesses that face extreme competition are susceptible to many inherent risk factors – the measurement of the auditor’s assessment of the likelihood that there are material misstatements in an account balance before considering the effectiveness of internal control. Complex valuation issues and related party transactions are two such factors that would affect audit planning decisions. Valuation issues may lead the audit team to request more evidence, if they choose to accept the audit at all. Risks such as inventory turnover leading to potential misstatements of inventory, costs of goods sold, or obsolescence of inventory may influence the audit firm’s decision to hire outside specialists to assist in the audit. Another inherent risk factor, client business risk (competitive

2. Chan, K., Kleinman, G., & Lee, P. (2009). The impact of Sarbanes-Oxley on internal control

A company which is publicly traded in the U.S. is required to submit the 10-K form to Securities and Exchange Commission (SEC) once a year. The 10-K form is a comprehensive report of a company’s performance. This report is essential to an investor for evaluating a company’s financial health. For this assignment, I have chosen to consider Macy’s Inc. 10-K form and evaluate its financial condition. I am going to discuss about Macy’s Merchandise Inventories including the inventory method used by Macy’s, Cost of Sales to net Sales Ratio, Inventory Turnover and Days in Inventory.

This paper will discuss the legislation that was enacted following these events. It is known as the Public Accounting Return and Investor Protection Act, better known as the Sarbanes-Oxley Act, and has been enacted since the year 2002 (Mishkin, 2012, p. 158). This Act is applicable to all public companies within the US as well as any international companies who have securities within the US registered with the SEC ("The Vendor-Neutral Sarbanes-Oxley Site", 2012). In this paper, it will be discussed why Sarbanes-Oxley was enacted and the key specifications.

1235 Winner 's Road Write City, IN 12354 DONALDSON AND LUCIER, LCC has conducted an audit of Apollo Shoes, Inc. balance sheets, the retained earnings, cash flows, and other related statements of income for the year ended December 31, 2006/2007. Apollo Shoes Inc management is responsible for maintaining the effective internal controls that goes along with the financial statements and how well the accuracy is going to be. Donaldson and lucier, LLC has evaluated the effectiveness of the said controls and with everything to see the relevance in the timing, the substantive in quality, and the comprehensive in nature. The responsibility of our firm is to express an opinion that is supported by audit evidence in regards to the accuracy of the Apollo Shoes, Inc. financial statements. Our firm has conducted all audit related services that is accepted by the United States and the generally accepted auditing standards. The planning and performance done ensures that the audit was done to execute and obtain reasonable assurance that the financial statements published by Apollo Shoes, Inc. are free and clear of material misstatement. It is going to include the examination of the evidence and/or the supporting documentation for the amounts that are disclosed and included

This case analysis commences by explaining the type of accounting officer needed to execute the job functions for the client, Big Spenders Inc. The next objective will be to examine the income statements of the two prospective business entities that the client intends to choose from concerning investment – in order to diversify its portfolio. The strategies that will be explored in terms of the analysis of the income statements includes the computation of (i) operation profit margin, (ii) gross margin, (iii) net profit margin, and (iv) return on equity – for both companies of interest. The results of examinations will put the accountant in a position to make sounds recommendation to his superior at BUSI 1043 LLP, so that Big Spenders Inc. can be properly guided.

Our class was assigned a company for financial scrutiny and to obtain financial statements (Balance Sheet, Income Statement, and Cash Flow Statement), from the company’s most recent Annual Report. We are to prepare a written analysis of the organization with the following requirements:

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 inherent risks in an extremely competitive industry or sub-industry may include inappropriate revenue and expenses recognition, aggressive competing strategies, and unethical management in order to manipulate the financial situation and statements of the company. For example, management may try to improperly increase sale/revenue numbers by pushing merchandises to customers before year-end cut off or management may refuse to write off large obsolete inventory accounts which have decrease in value which in turn falsely exaggerates asset accounts. These risks may greatly affect the audit planning process. Auditors should pay more attention to audit procedure in testing cut off sale and expenses. Furthermore, auditors should determine the audit procedures to spend more time and resources to examine the client’s inventory accounts and the fair value of

Executive Summary Business and Industry Analysis Competitive Advantages Five Forces Model Industry Competitive Analysis Accounting Analysis Key Accounting Policies Degree of Accounting Flexibility Evaluation of Accounting Strategy Accounting Quality of Disclosure Red Flags Quantitative Analysis Ratio Analysis Liquidity Profitability Capital Structure Forecasting Balance Sheet Income Statement Statement of Cash Flows Forecast Summary Valuation Analysis Method of Comparables

As you know, our company has been audit Movies R US for eight years, and it is a public company. Now Movies R US wants to change almost all its business model, from DVD rental into online movies download. This means this client needs new IT department to maintain its download application; it needs to dispose of inventories, because Movies R US decided to close 40 of their 50 stores. This new situation will force us to change our traditional audit process. Since this public company decided to reform its business model, the financial statement’s users will be more dependent on audit report we provide to them. Therefore, our auditors need more investigation for this client. As I mentioned before, Movies R US is one of our old clients, we know this company. But we still need in-depth investigating its new business model, controls and risks. In the final, we might have to change our audit report due to the brand new investigation result.

This paper provides an in-depth evaluation of Sarbanes-Oxley Act, which is said to be promoted to produce change in the corporate environment, in general, by stressing issues of public accountability and disclosure in the financial operations of business. It explains how this is an Act that represents the government's and the Security and Exchange Commission's concern in promoting ethical standards in terms of financial disclosure in the corporate environment.