Shoe Zoo Essay

E. Why does the auditor not use the same tolerable misstatement or percentage of account balance for all financial statement accounts?

There are several reasons why AGI should consider Mercury Athletic as an appropriate target for acquisition. First, acquiring Mercury could improve both companies financially. Acquiring Mercury would double AGI’s revenue. Although Mercury’s financial performance has been disappointing, they experienced top line growth of 20% in 2006. Unfortunately, their profitability has been disappointing due to price concessions to big box retailers and an unsuccessful women’s line. Mercury’s (and ultimately AGI’s) profitability could be improved by the synergies of the two companies merging. Synergies within supply chain, operations, research and development, and advertising should all improve Mercury’s EBITDA.

I Think Jordans are good shoes. Jordans are good shoes because they have a lot of different varieties , the styles/varieties are basketball , running and some cleats. The supporting of the jordan shoe make them comfortable because they secure your ankles from sprains, pain and other bad things without ankle support shoes.

Quick! Look at your shoes. If your shoes have laces, they might be tied wrong. In fact, about 50% of Americans tie their shoes the wrong way, that is, they use the wrong knot when tying their shoes. If your laces come undone, or your bows are twisted, or you double knot your shoes to prevent them from coming untied, then chances are, you tie your shoes the wrong way.

3. Substantive tests procedures: The audit team should perform substantive tests on Smackey’s accounting transactions and

Also he may conduct bank reconciliations on pertinent accounts to make sure no discrepancies or misstatements are found. The auditor should also perform vertical and horizontal analysis for the income statements and balance sheets by the use of ratios.

There are two general categories of phase III procedures. Analytical procedures use comparisons and relationships to assess whether account balances or other data appear reasonable. For example, to provide some assurance for the accuracy objective for both sales transactions (transaction-related audit objective) and accounts receivable (balance-related audit objective), the auditor might examine sales transactions in the sales journal for unusually large amounts and also compare total monthly

) There was a lack of adequate cut-off procedures to ensure the timely recording of certain period-end accruals. This resulted in an audit adjustment of $3,578,000. The benchmark for overall materiality is $3,508,000, I would consider the audit adjustment of $3,578,000 a material misstatement. Control environment, principle 2 the board of directors and management exercise oversight of development and performance of internal controls. Due to the severity and material weakness of lack of adequate cutoff procedures to ensure timely recording of period end accruals. Management and the board of directors should evaluate performance of internal control activities including adherence to standards of conduct and expected levels of competence. In

The auditor should have verified the accuracy and the existence of the figures that were appearing in the income statement as revenue. The verification of the sales system should include authorization of the sales and the accounts recording of these sales (Rittenbergm Et al., 2009). An audit on the sale systems involves ensuring that there is proper authorization of the sales orders, proper matching of customers to these orders, payments and the invoices and the records of goods outwards. An audit plan on revenue and sales system should include verification of any sales figure that appears at the end of the financial period as in most cases, there is a possible risk of fraud or wrong adjustment of figures. It would also include an audit on the sales ledger control

Due to financial hardship, the Nyke shoe company feels they only need to make one size of shoes, regardless of gender or height. They have collected data on gender, shoe size, and height and have asked you to tell them if they can change their business model to include only one size of shoes – regardless of height or gender of the wearer. In no more 5-10 pages (including figures), explain your recommendations, using statistical evidence to support your findings. The data found are below:

Performing internal tests of controls is intended to assess the operating effectiveness of those internal controls. Here the staff would select an area of control to test, perhaps inventory management and return policy. They would then look at the procedures that help prevent fraud or error, talk to management, and observe activities. They would notice there is very little control in place for this area. There is no management oversight or dock security measures, no direct recording of sales receipts, shipping labels, or matching to accounts receivable. This would be noted as an area of additional concern. The next stage is to perform substantive testing procedures, where the purpose is to collect audit evidence that the management assertions made in the financial statements are reliable and in accordance with GAAP. Since my staff is good, they would have noticed the company’s sales projections are weak in control and are overstated by around 11%. They would perform a substantive test of detail in this area by selecting a sample of items from the account balances and finding bank statements, invoices, and test of details of balances. They would likely see specifically where the over-projections are being made. Lastly, in finalization, they would compile a report to management detailing any important matters, evaluating the audit evidence, and considering the type of audit opinion that should be reported. Specifically here, they would

The chief executive of the company was closely working with the vendors whose confirmations were vital in the auditing work and hence they could have submitted false confirmations. The auditing firm established a national risk management program for its clients and so national reviews were done to identify the high risk items in the financial statement. The vendor allowances were particularly high but they were not documented. As such, the auditors were supposed to demand for the documentations and compare them with the real figures. It is however noted that most of the documentations received were non-standard and this could have led to a different audit report given that vendor allowances were earlier identified as a high risk area. Inventory management was found to be poor especially in the allowances for inventory reserves. The audit firm was therefore obliged to carry out a thorough evaluation of the inventory reserves and determine whether it was reasonable. The valuation was also supposed to include all classes of inventory but for the case of the company, the evaluation excluded instances where no sales had been made. Hence, this evaluation could not accurately represent the position of the inventory reserve in the company. (Waters,2003)

B) I think the auditors should have equal responsibility for detecting material misstatements due to error and fraud. It’s their job to make sure the financial statements are as accurate as possible. Although it may be hard to check all the information from a company it’s the responsibility of the auditor to sign off that everything is in check.

Basketball is a sport that relies a lot on the player’s footwork. You will realize that athletes in basketball normally make sharp cuts, jump around and move in all directions in a quick manner. The player must wear the right basketball shoes in order to do this. This will give the player a god opportunity to succeed in this game. The right pair of basketball shoes will provide the desired protection, traction and avoid injury while on the court. This is the reason why you should pick the right pair of basketball shoes. There are several things that you should consider when choosing the right basketball shoes. These include:

The movie The Field of Lost Shoes, purely based off of the Battle of New Market, is both accurate and inaccurate when displaying soldiers’ lifestyle and their experiences that occurred during the Civil War. The movie is inaccurate in a way that is portrays soldiers having to leave their jobs, when they really did have jobs they had to leave. The movie is accurate in most scenes. Its accuracy proves to be correct in the scenes that women had to step in as nurses and help the wounded, soldiers leaving their loved ones, the horrible conditions that the soldiers had to fight through, and when groups of stable soldiers went to the field’s aftermath to rescue wounded soldiers and their loved ones. Overall, the movie is consistently accurate all the way through to show how the Civil War impacted the American lifestyle.