EP AUDITING+ASSURANCE...-MYACCT.LAB
16th Edition
ISBN: 9780134148656
Author: ARENS
Publisher: PEARSON CO
expand_more
expand_more
format_list_bulleted
Question
Chapter 20, Problem 28DQP
a.
To determine
Find out the components of the chairman and chief executive officer’s total compensation for 2014.
b.
To determine
State one
c.
To determine
Provide at least one audit procedure the auditor performs to test the occurrence objective related to the awarding of the chairman and CEO’s stock awards and stock option/ stock appreciation rights (SAR).
d.
To determine
Explain the manner in which the auditor tests the fair value of the stock option/ stock appreciation rights (SAR).
e.
To determine
Explain the reason for which the presentation and disclosure-related audit objectives are important for stock-based compensation.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Rules recently established by the Securities and Exchange Commission include a "say on pay rule that requires:
Multiple Choice
Audit committee review of executive compensation.
Nonbinding shareholder votes on executive pay.
Compensation committees as a part of corporate boards.
Detailed disclosures of executive compensation.
Shareholder votes on dividends declared.
Suppose you were a member of Company A’s board of directors and chairperson of the company’s compensation committee. What factors should your committee consider when setting the CEO’s compensation? Should the compensation consist of a dollar salary, stock options that depend on the firm’s performance, or a mix of the two? If “performance” is to be considered, how should it be measured? Think of both theoretical and practical (that is, measurement) considerations. If you were also a vice president of Company A, might your actions be different than if you were the CEO of some other company?
Which of the following documents will contain information about the compensation for Directors of a public company:
The 10Q
The Proxy Statement
The Annual Report
The outside Auditors Report
Chapter 20 Solutions
EP AUDITING+ASSURANCE...-MYACCT.LAB
Ch. 20 - Prob. 1RQCh. 20 - Prob. 2RQCh. 20 - Distinguish among a payroll master file, a W-2...Ch. 20 - Prob. 4RQCh. 20 - Prob. 5RQCh. 20 - Prob. 6RQCh. 20 - Prob. 7RQCh. 20 - Prob. 8RQCh. 20 - Prob. 9RQCh. 20 - Prob. 10RQ
Ch. 20 - Prob. 11RQCh. 20 - Prob. 12RQCh. 20 - Prob. 13RQCh. 20 - Prob. 14RQCh. 20 - Prob. 15RQCh. 20 - Prob. 16.1MCQCh. 20 - Prob. 16.2MCQCh. 20 - Prob. 16.3MCQCh. 20 - Prob. 17.1MCQCh. 20 - Prob. 17.2MCQCh. 20 - Prob. 17.3MCQCh. 20 - Prob. 18.1MCQCh. 20 - Prob. 18.2MCQCh. 20 - Prob. 18.3MCQCh. 20 - Prob. 19DQPCh. 20 - Prob. 20DQPCh. 20 - Prob. 21DQPCh. 20 - Prob. 22DQPCh. 20 - Prob. 23DQPCh. 20 - Prob. 24DQPCh. 20 - Prob. 25DQPCh. 20 - The following are various asset misappropriations...Ch. 20 - Archer Uniforms, Inc., is a distributor of...Ch. 20 - Prob. 28DQPCh. 20 - Prob. 29C
Knowledge Booster
Similar questions
- Which of the following statements are correct regarding Sarbanes- Oxley (SOX) and Dodd-Frank (DF)? I. DF requires that public firms offer an advisory vote to shareholders on top executive compensation. II. SOX imposes criminal penalties on the CEO and CFO for fraud or for retaliation on whistle blowers. III. The compliance costs for SOX can be substantial and have encouraged some firms to "go dark." IV. DF requires companies to disclose whether directors and officers are permitted to hold put options which protect their ownership position in the firm. O I and II only O I and III only O II and III only O I, II, and III only O I, II, III, and IVarrow_forwardSuppose you were a member of Company X’s board of directors and chairman of the company’s compensation committee. What factors should your committee consider when setting the CEO’s compensation? Should the compensation consist of a dollar salary, stock options that depend on the firm’s performance, or a mix of the two? 3.If “performance” is to be considered, how should it be measured? Think of both theoretical and practical (that is, measurement) considerations.arrow_forwardYou are offered a job you know that accepting this job may eventually lead to a promotion into the role of the financial manager. As the potential financial manager, what federal and shareholder requirements would you need to be familiar with in order to ensure that you are being completely compliant? While investigating the shares offered to you by your potential boss, you discover that the company you are considering working for is not registered as required under the Securities Act of 1933. How does this influence you as a potential employee and as a potential shareholder relative to any applicable statutes or laws?arrow_forward
- Based on this topic reading answer the following questions in your discussion post. (Note address these questions and not the ones that follow question instructions) 1. What are the major recommendations of the stock compensation pronouncement? 2. How do the provisions of GAAP in this area differ from the bill introduced by members of Congress, which would require expensing for options issued to only the top five officers in a company? (Focus on comparability) 3. The bill in Congress urges the FASB to develop a rule that preserves "the ability of companies to use this innovative tool to attract talented employees." Do you believe that this will impact the neutrality of financial accounting and reporting? Explain. Your response must be a minimum of 25O words. You need to have a minimum 3 citation references in APA format. In-line citations and the complete reference must be provided.arrow_forwardSuppose you were a member of Company X’s board of directors and chairpersonof the company’s compensation committee. What factors should your committeeconsider when setting the CEO’s compensation? Should the compensation consistof a dollar salary, stock options that depend on the firm’s performance, or a mixof the two? If “performance” is to be considered, how should it be measured?Think of both theoretical and practical (that is, measurement) considerations. Ifyou were also a vice president of Company X, might your actions be differentthan if you were the CEO of some other company?arrow_forwardAssume you are the financial director of a public company which has been experiencing a decline in financial performance. At a board meeting it is being proposed that all directors and senior managers receive a substantial increase in pay and bonuses. One director has stated that the figures can be masked, legitimately, in the annual report and accounts. It has also been proposed not to increase the dividend to shareholders, stating that the money is needed for essential investment. The company does have assets which are in need of replacement. What do you think about these proposals? Do they suggest good, bad, or indifferent corporate governance?arrow_forward
- Richardson Company is contemplating the establishment of a share-based compensation plan to provide long-run incentives for its top management. However, members of the compensation committee of the board of directors have voiced some concerns about adopting these plans, based on news accounts related to a recent accounting standard in this area. They would like you to conduct some research on this recent standard so they can be better informed about the accounting for these plans. Instructions Access the IFRS authoritative literature at the IASB website. (Click on the IFRS tab and then register for free eIFRS access if necessary.) When you have accessed the documents, you can use the search tool in your Internet browser to respond to the following questions. (Provide paragraph citations.) a. Identify the authoritative literature that addresses the accounting for share-based payment compensation plans. b. Briefly discuss the objectives for the accounting for share-based…arrow_forwardWhen employees have a conflict of interest between their personal compensation and provision of truthful financial statements to shareholders, the securities regulator, such as the Securities Exchange Commission, should shut down such financial companies. the external auditors should take the word of the employees and the management about the value of such securities. the accounting standards' supervisory board should be required to audit such financial companies. the board of directors should approve clear policy guidelines and monitor their enforcement to combat such conflicts. COarrow_forwardJ-Chron's board of directors periodically meets with the CFO of the company. The CFO reports on the financial status of a company project. The board asks whether the project is compliant with legally-required accounting principles, but asks no other questions about the project, such as how the project supports the company’s mission and strategy. Which of the following is true? A. The board is meeting legal requirements but not its duty of care to shareholders. B. The board is not legally required to meet any duty of care requirements. C. The board is fully meeting its duty of care to shareholders. D. The board is not meeting its duty of care to shareholders.arrow_forward
- Every annual report of a public company includes an extensive discussion and analysis provided by thecompany’s management. Specifically, which aspects of the company must this discussion address? Isn’tmanagement’s perspective too biased to be of use to investors and creditors?arrow_forwardIndependent directors are the agent and trustee of the company, their duties and responsibility towards the shareholder and other stake holders are akin to full time director , but there are few cases reported where the independent director had their personnel hidden interests in the company that jeopardize the general interest of the appointing independent director on board of company. Explain the responsibility of the independent directors toward shareholder and stakeholder. Explain your role in board meetings if you are appointed as an independent director of a company.arrow_forwardIncentive compensation based on accounting profits is the preferred method because accounting profits are audited and disclosed to all investors through SEC filings. Select one: True Falsearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education