Management and Internal Control, accounting homework help

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1. “Management and Internal Control” Please respond to the following:

  • Create a scenario where external auditors determined that a company’s internal controls were deficient, but such a deficiency might not mean that a material weakness existed. Ascertain the impact on the audit plan if additional deficiencies are discovered on other related internal controls. Support your position.
2. 
“Audit Risk and Fraud”
 Please respond to the following:

  • Create a scenario in which a company conceals financial fraud from the auditing firm through the use of information technology, and suggest at least one (1) way in which an auditing firm can minimize its exposure to this risk.
  • According to the text, planning an audit involves establishing the overall audit strategy for the engagement and developing an audit plan in an attempt to reduce audit risk to an acceptable level. Select a balance sheet account or income statement account, and discuss the type of audit procedure that would produce the most reliable evidence for that account balance. Defend your position.

3. 
“Internal Controls and Sampling Strategy”
 Please respond to the following:

  • Imagine that you have been hired to audit the sales and collections of a medium to large merchandising company. Suggest at least two (2) ways that management could manipulate earnings, and make specific recommendations for the internal control procedure to prevent or detect the transaction. Justify your response.
  • Discuss the advantages and disadvantages of at least two (2) sampling methods. Make a recommendation for the best method to sample accounts receivables. Support your position.
4. 
“Consolidated Financial Statements – Ownership, Income Taxes, and Legal Reorganizations”
 Please respond to the following:

  • Determine the fundamental advantages to a business combination of filing a consolidated tax return. Next, analyze the main reasons why members of a business combination file separate returns. Provide a rationale for your response.
  • Differentiate between the two (2) categories of liabilities (i.e., fully secured and partially secured) that have priority in business liquidation. Analyze the main reasons why unsecured creditors favor reorganizing an insolvent company rather than forcing it into liquidation. Provide support for your rationale.
5. 
“Foreign Currency Transactions and International Financial Reporting Standards (IFRS)”
 Please respond to the following:

  • Analyze the main reasons why a company might prefer a foreign currency option over a forward contract in hedging a foreign currency firm commitment. In contrast, analyze the main reasons why a company might prefer a forward contract over an option in hedging a foreign currency asset or liability. Determine the option (i.e., a foreign currency option or a forward contract) that you consider to be more effective. Provide a rationale for your response.
  • Assume that all the companies in the world use International Financial Reporting Standards (IFRS). Determine at least two (2) obstacles to the worldwide comparability of financial statements, and provide one (1) strategy to overcome the obstacles in question. Provide support for your rationale.
6. 
“Translation of Foreign Currency Financial Statements”
 Please respond to the following:

  • Analyze the fundamental differences between remeasurement and the translation approach when preparing a foreign currency financial statement for a company of your choice. Next, determine one to two (1-2) situations when remeasurement is most appropriate. Provide support for your position.
  • Analyze the underlying conceptual differences between the temporal method of translation and the current rate method of translation. Determine how the balance sheet exposure differs under the two (2) aforementioned methods. Select the method that you believe provides the least balance sheet exposure. Provide rationale for your selection.
7. 
“Technological Advancements and Challenges”  Please respond to the following:

  • In a departure from its normal business operations Apple has recently teamed up with a bio-tech company to investigate the possibility of cloning human organs. You have been tasked with creating a press release to make this decision public and get ahead of any negative press. Compose a statement to the press to explain Apple’s decision and quell potential negative reactions.

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