Develop audit procedures for the use of analytical procedures as a substantive procedure in the testing of the reasonableness of monthly payroll costs for the year
Q: Various Completion Matters. For each of the following independent situations, describe the most…
A:
Q: Key note from review of director meeting minutes: The chairman observed that in recent…
A: As per the review of the director, there is the problem of limitation of scope and if there is any…
Q: You are evaluating audit results for assets in the audit ofRoberts Manufacturing. You set the…
A:
Q: Ed Caluag, CPA was engaged to audit the financial statement of KMJS, Company, a continuing audit…
A: Firstly select the payroll register for a specific period, and check the details: Test the…
Q: Analytical procedures are useful at the planning stage for risk assessment. Using analytical…
A: Three Areas that need additional Analytical procedures, Sale Non-Current Assets Inventories Repair…
Q: Develop audit procedures for the use of analytical procedures as a substantive procedure in the…
A: First and foremost, we must comprehend the concept of payroll cost. Payroll cost refers to the wages…
Q: Important accounting principles or policies that could affect interpretation of the financial…
A: According to data - The following discussion and analysis of The Kroger Co.'s financial condition…
Q: Consider the following material and independent situations (i) to (iii) below. In each situation,…
A: Audit Procedures Audit procedures is an important activities which are involved in the Audit…
Q: When the FASB issues new standards, the implementation date is frequently 12 months from date of…
A:
Q: Which of the following is least likely to be a procedure included in an accountant’s review of…
A: Interim financial information refers to the financial information of an entity or the statements of…
Q: o settle the outstanding amounts. a. Faithful Representation; completeness; Enhancing b. Faithful…
A: The information is useful when it is of high quality and it provide information that is needed to…
Q: The Sarbanes-Oxley Act (SOX) requires that an auditor must O issue an internal control report…
A: The Sarbanes Oxley Act requires all the financial reports so that it can include the Internal…
Q: dentify the primary audit objectives that auditors hope to accomplish by confirming a client's…
A: Accounts receivable (AR) is the amount owing to a business for goods or services delivered or used…
Q: You are assigned to do the audit the work for Howard Ltd for the calendar year 2019, you found some…
A: Liability is the amount which the person or company owes to outsiders. Liabilities are recorded in…
Q: You are the senior in charge of the audit of Jewels Manufacturing Limited. The information below has…
A: Quick Ratio The purpose of measuring the quick ration which provides the insight about the liquidity…
Q: Audited financial statements ensure _________________________. Reliability of the financial…
A: Accounting is the detailed process of recording and analyzing transactions. Transactions are…
Q: ) The following audit procedures are typical of thosefound in auditing the payroll and personnel…
A: Auditing: In auditing, auditors verify the correctness and fair presentation of financial…
Q: You are the in-charge auditor for the Nelson Company engagement for the year ending December 31,…
A: Auditing means that the facts and figure of financial statements are true and correct or wrong as…
Q: (Treatment of Various Interim Reporting Situations) The following statement is an excerpt from the…
A: Generally accepted accounting principles (GAAP) allude to a typical arrangement of bookkeeping…
Q: Develop audit procedures for the use of analytical procedures in the planning phase to identify…
A: GIVEN Develop audit procedures for the use of analytical procedures in the planning phase to…
Q: State the accounting assumption, principle, qualitative characteristic, constraint or violation that…
A: There are various constraints or limitations that exist in preparation and presentation of the…
Q: Below here were subsequent event that occurs in your client. Consider that all events were has…
A: Subsequent event: A subsequent event is an event that occurs after a reporting period, but before…
Q: Engagement Timekeeping Records. A time budget is always prepared for audit engagements. Numbers of…
A:
Q: What analytical procedures can be use in the planning phase of an audit to identify significant…
A: Analytical procedures - Analytical procedures are those audit processes that helps auditor in…
Q: Cutoff tests designed to detect valid sales that occurred before the end of the year but have been…
A:
Q: Diane Smith, CPA, performed tests of controls and substantivetests of transactions for sales for the…
A: Definition: Auditing: In auditing, auditors verify the correctness and fair presentation of…
Q: Which of the following engagement planning procedures would most likely assist the auditor in…
A: Answer: Option d.
Q: Which of the following procedures would an auditor most likely perform to obtain evidence about the…
A: Subsequent events: Those events which occur between the date of financial statements and the audit…
Q: he internal audit director received an annual bonus as part of that individual’s compensation…
A: The internal audit activity must be independent, and internal auditors must be objective in…
Q: The audit firm shall communicate the results of the monitoring of its system of quality control to…
A: The business entities are required to conduct an audit of their accounting books so as to find out…
Q: Question 1: The adjustment to correct the interest income for 2021 includes a debit/(credit) to the…
A: As per our protocol we provide solution to the one question only but you have asked three questions…
Q: When the IASB issues new standards, the implementation date is usually twelve months from the date…
A: The accounting ethics is defined as the particular guidelines and the rules which are set through…
Q: For the 2021 audit of the financial statements, you are tasked to audit EMPLEO Corporation's…
A: Dividends is the part or share of profits that is, being distributed to the shareholders of the…
Q: You are now nearing the completion of the audit of Dawson Co Ltd for the year ended 31 December…
A: Answer: As per IAS 500, the audit evidences guide auditor to take proper audit evidences to support…
Q: Identify the phase of the audit in which each activity occurs. Put parts 1 through 9 of the audit…
A: Given are the parts of audit activities.
Q: ETHICS (Rule-Making Issues) When the FASB issues new pronouncements, the implementation date is…
A: The ethical issue involved in this case are: The pronouncement of information affects net income of…
Q: Controller as Auditor. The chairman of the board of Hughes Corporation proposed that the board hire…
A: Definition: Auditing: Auditing refers to an independent examination of financial information of any…
Q: Calculate materiality for the client, assuming that it is a profit-oriented company and moderate…
A: We set the Materiality base as the net income. Here the pre tax income of the prior years is the…
Q: Ratio Unaudited 2020 figures 2019 2018 2017 Inventory turnover 1.45 1.83 2.69 3.35 Quick…
A: Issues that may affect the going concern are: Low Inventory Turnover Ratio as compared to last 3…
Q: In connection with the planning phase of an audit engagement, which of the following statements is…
A: Planning of Audit Engagement: An agreement between an auditor and a client in which the auditor…
Q: A CPA is performing review services for a small, closely held manufacturing company.As a part of the…
A: Auditing: Auditing is an independent examination of financial statements. The set of financial…
Q: You are auditing the December 31, 2021, accounts payable balance of one of your firm's divisions.…
A: Answer: As a auditor for audit of accounts payable, all the testing of audit procedures is to be…
Q: Consider the following independent situations, all of which apply to audits of entities for the year…
A: Auditing: Auditing is an independent examination of financial statements. The set of financial…
Q: please answer with reason
A: Audit: It is a procedure for examining a company's financial statements. The goal of auditing is…
Q: When the IASB issues new standards, the implementation date is usually twelve months from the date…
A: ''Since you have posted a question with multiple parts, we will solve the first three sub-parts for…
- Develop
audit procedures for the use of analytical procedures as a substantive procedure in the testing of the reasonableness of monthly payroll costs for the year - Develop audit procedures for the use of analytical procedures in the planning phase to identify significant changes in operating and financial activities of the firm over previous years
- Identify benefits of using analytical procedures in the audit process
May I get some assistance with these questions please
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Recognizing pension expense The annual examination of Felton Companys financial statements by its external public accounting firm (auditors) is nearing completion. The following conversation took place between the controller of Felton Company (Francie) and the audit manager from the public accounting firm (Sumana): Sumana: You know, Francie, we are about to wrap up our audit for this fiscal year. Yet, there is one item still to be resolved. Francie: Whats that? Sumana: Well, as you know, at the beginning of the year, Felton began a defined benefit pension plan. This plan promises your employees an annual payment when they retire, using a formula based on their salaries at retirement and their years of service. I believe that a pension expense should be recognized this year, equal to the amount of pension earned by your employees. Francie: Wait a minute. I think you have it all wrong. The company doesnt have a pension expense until it actually pays the pension in cash when the employee retires. After all, some of these employees may not reach retirement, and if they dont, the company doesnt owe them anything. Sumana: Youre not really seeing this the right way. The pension is earned by your employees during their working years. You actually make the payment much laterwhen they retire. Its like one long accrualmuch like incurring wages in one period and paying them in the next. Thus, I think you should recognize the expense in the period the pension is earned by the employees. Francie: Let me see if Ive got this straight. I should recognize an expense this period for something that may or may not be paid to the employees in 20 or 30 years, when they finally retire. How am I supposed to determine what the expense is for the current year? The amount of the final retirement depends on many uncertainties: salary levels, employee longevity, mortality rates, and interest earned on investments to fund the pension. I dont think an amount can be determined even if I accepted your arguments. Evaluate Sumanas position. Is she right, or is Francie correct?Classify each of the following actions as either being associated with the financial accounting information system (FS) or the cost management information system (CMS): a. Determining the total compensation of the CEO of a public company b. Issuing a quarterly earnings report c. Determining the unit product cost using TDABC d. Calculating the number of units that must be sold to break even e. Preparing a required report for the SEC f. Preparing a sales budget g. Using cost and revenue information to decide whether to keep, or drop, a product line h. Preparing an annual statement of financial position that conforms to generally accepted accounting principles (GAAP) i. Using cost and revenue information to decide whether to invest in a new production system or not j. Reducing costs by improving the overall quality of a product k. Using a debt-equity ratio and liquidity ratios from a balance sheet to assess the likelihood of bankruptcy l. Using a public companys financial statements to decide whether or not to buy its stockDevelop audit procedures for the use of analytical procedures in the planning phase to identify significant changes in operating and financial activities of the firm over previous years
- The practice of auditing firms to spread work throughout the year by carrying out as many auditing procedures as practicable before the balance sheet date, in order to minimize the load during the peak period. This is called a. Test of recorded transactions b. Confirmation of receivable and payablesc. Observation and test-check of inventoriesd. Interim workCompany A's balance sheet and income statement for the fiscal year ending 2021 show the following: - Net Income: $15,000,000 - Total Assets: $75,000,000 - Total Revenue: $200,000,000 - Net Revenue: $50,000,000 You are the associate auditor on this client. Your senior auditor tells you that for Company A, 1.5% is the materiality judgement. Based on the appropriate benchmark identified in Question #1, determine the planning materiality. Show your work. Your work should look like: BENCHMARK AMOUNT x MATERIALITY JUDGEMENT = PLANNING MATERIALITYWhich of the following procedures would an auditor most likely perform to obtain evidence about the occurrence of subsequent events? A. confirming a sample of material accounts receiveable established after year-end. B. Comparing the financial statements being reported on with those of the prior period. C. Investigating personnel changes in the accounting department occurring after year-end. D. Inquiring as to whether any unusual adjustments were made after year-end.
- asap F Identify the primary audit objectives that auditors hope to accomplish by confirming a client's year-end accounts receivable. Explain the difference between "positive" and "negative" confirmation requests and discuss the quality of audit evidence yielded by each.You are in charge of auditing PLM (PopoyLangMalakas) Company's investmentaccounts for the year ended December 31, 2021, which was incorporated last March 3, 2020. During the course of the audit, you have obtained the balances and therelated journal entries of its investment related transactions and have revealed thefollowing information: Question 1: The adjustment to correct the interest income for 2021 includes adebit/(credit) to the interest revenue account amounting to? (Put a negativesign if credit) Question 2: How much is the retroactive adjustment to the beginning balance ofretained earnings for the year 2021, pertaining to the investment in BSP bonds?(Please indicate debit or (credit), use negative sign if credit).Question 3: The correct amount of investment in BSP bonds that should bepresented in the statement of financial position as of December 31, 2021 is?While assisting the accounting department with completing the current year's financial statements, you have been asked to review a list of contingent liabilities. How would a manager, review the list of contingent liabilities and determine their probability?
- Which of the following BEST (select one) describes why auditing can be viewed as a continuous cyclical process? a) The audit plan is used to develop the audit schedule. b) Many audit departments review the same areas each year as part of the audit plan. c) Historical and current information from audits should be incorporated into the risk assessment. d) Businesses go through economic cycles, so audit plans must go through cycles.The following are parts of a typical audit for a company with a fiscal year end of July 31. Set acceptable audit risk and decide preliminary judgment about materiality and performance materiality. Understand internal control and assess control risk. Perform substantive analytical procedures for accounts payable. Confirm accounts payable. Perform tests of controls and substantive tests of transactions for the acquisition and payment and payroll and personnel cycles. Perform other tests of details of balances for accounts payable. Perform tests for review of subsequent events. Accept the client. Issue the audit report. Required Identify the phase of the audit in which each activity occurs. Put parts 1 through 9 of the audit in the sequential order in which you would expect them to be performed in a typical audit. Identify those parts that will frequently be done before July 31.Analytical procedures are useful at the planning stage for risk assessment. Using analytical procedures and the following extracts from the draft financial statements of an audit client, identify THREE areas which you believe require further investigation, explaining your reasons. 2020(draft) 2019(audited) £ £ Sales 7,765,000 5,974,500 Cost of Sales 5,823,750 4,779,600 Gross Profit 1,941,250 1,194,900 Depreciation 269,800 257,900 Salaries 680,000 645,000 Repairs and maintenance costs 328,000…