Answered: Required: a. Research the current state…

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter2: The Auditor’s Responsibilities Regarding Fraud And Mechanisms To Address Fraud: Regulation And Corporate Governance

Section: Chapter Questions

Problem 25RQSC

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John Ozment, director of special projects and analysis for Ozment’s Corporation, is responsible for preparing corporate financial analyses and monthly statements and reviewing and presenting the financial impacts of proposed strategies to upper management. Data for such financial analyses are obtained from operations and financial databases through direct queries of Ozment’s department staff. Reports and charts for presentations are then prepared by hand and typed. Multiple copies are prepared and distributed to various users. The pressure on Ozment’s group has intensified as demand for more and more current information increases. A solution to this reporting problem must be found. The systems department wants to develop a proprietary software package to produce the reports automatically. The project would require the company to make a considerable programming investment. Ozment is concerned about the accuracy, completeness, and currency of data in automatically produced reports. He has heard about a reporting system called XBRL and wonders whether a new system based on this technology would not be more effective and reliable. Required: a. Research the current state of XBRL and determine if this technology is appropriate for internal reporting projects such as this. b. Identify the enhancements to current information and reporting that the company could realize by using XBRL. c. Discuss any data integrity, internal control, and reporting concerns associated with XBRL

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