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90 Cards in this Set
- Front
- Back
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Components of Internal Control
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Control Environment
Risk Assesment Information and Communication Systems Monitoring Existing COntrol Activities |
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Control Environment
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Philosophy of managemnet
Human Resources Reprting competentcies Authority and Responsibility Structure Ethical Values Dircetors |
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Components of ERM
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Internal Environment
Setting Objectives Event Identification Assessment of Risk Risk response Control Activities Information and Communication Monitoring |
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ERM Internal environment
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PHRASED
Plus Committment to competence |
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ERM Enterprise objectives
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Strategic
Operations Reprting Compliance |
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Fishbone diagram
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Materials
Manpower Machinery Method |
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Cost Accounting System objectives
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Product Costing
Income Determination Efficiency Measures |
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Weighted average method
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Units completed
+ Ending WIP x % complete |
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FIFO Method
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Beg WIP x % to be completed
+Units completed - Beg WIP + Ending WIP x % completed |
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Cost per Equivalent Unit
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Weighted = (Beg cost+Cur Cost)/EQ Units
FIFO= Cur Cost/ EQ units |
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VC NI vs Absorption NI
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No change =
Increas in INV: Abs NI> VC NI Decrease in INV: VC NI> Abs NI |
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Breakeven Point in Units
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Total Fixed Costs/ CM per unit
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Breakeven point in dollars
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Total FC/ CM Ratio
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Margin of Safety in Dollars
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Total Sales-Breakeven Sales
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Margin of Safety %
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Margin of Safety/Total Sales
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DM Price Variance
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Actual Quan Purchase * (Act price- STD price)
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DM usage variance
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STD price * (Act quan used-STD quan allowed)
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DL Rate variance
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Act hours worked *( Act rate- STD rate)
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DL Efficiency Variance
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Std rate * (Act hours worked - Std hours allowed)
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Net Overhead Variance
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Overhead applied - Actual Overhead
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Overhead Budget Variance
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(Budgeted FOH +(Std DLH allowed*stadard VOH rate))-Actual overhead
Also: OH Efficiency + OH Spending |
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Overhead Vol Variance
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Overhead Applied - (Budgeted FOH +(Std DLH allowed*stadard VOH rate))
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Overhead Spending Variance
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(Budgeted FOH+(Actual DLH worked*Standard VOH rate))- Actual OH
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Overhead Efficiency Variance
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(Budgeted FOH +(Std DLH allowed*stadard VOH rate))-(Budgeted FOH+(Actual DLH worked*Standard VOH rate))
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Sales Price Variance
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(Actual Unit SP- Budgeted unit SP)* Actual Units sold
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Sales Volume Variance
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(Actual Sold UNits- Budgeted unit sales)* Std UCM
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Sales Mix Variance
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(Actual sales mix-Budgeted Sales mix)*actual sld units*Std UCM
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Market Size Variance
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(Act Mkt Size-Std Mkt Size)* Std mkt share* UCM
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Market Share Variance
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(Act Mkt %-Std mkt%)* actual industry units*Std UCM
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Responsibility Segments
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Cost SBU
Revenue SBU Prfit SBU Investment SBU |
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Designs for Financial Scorecards
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Accurate
Timeley Understandbale Specific Accountability |
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Profitability Index
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PV Net future inflows/PV initial investment
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Payback Period
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Net Initial Investment/ Increase in annual net after tax cash flow
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Degree operating leverage
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% change in EBIT/% change in sales
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Degree Financial Leverage
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% change EPS/% change in EBIT
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Degree Combined Leverage
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% change EPS/ % Change Sales
DOL*DFL |
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Weighted Average interest rate
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Effective Annual interest payments/ debt cash available
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Cost of debt
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Pre tax cost of debt * (1-Tax rate)
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Cost of Preferred stock
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Div per share/ Proceeds per share
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Cost of Retained earnings or Equity
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CAPM
or (D1/P0)+ g |
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ROI
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Income/Investment Capital
Profit margin*invesment turnover |
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Investment Turnover
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Sales/invested capital
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Return on Assets
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NI/ Average total assets
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Residual Income
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NI-Reqd return
Req return = NBV*hurdle rate |
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EVA
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Income after taxes - Req return
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debt to total capital ratio
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Total D/ D+E
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Debt to assets
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Total debt/Total assets
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Debt to equity
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Debt/Total SE
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Quick ratio
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Cash+Mkt securites +receivables)/current liabilities
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APR of quick payment discount
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=(360/(pay perid-disc period))*(disc/100-disc%)
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Cash conversion cycle
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inventory conversion period
+ receivables collection period -Payables deferral period |
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Inventory Turnover
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COGS/average inventory
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Inventory Conversion Period
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365/Inventory Turnover
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Accts receivable turnover
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Sales/Avg A/R
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Receivables Collection Period/Days sales outstanding
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365/A/R turnover
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A/P turnover
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COGS/ Avg A/P
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Accounts payable defferal period
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365/ A/P Turnover
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Reorder point
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Sfety stock +(lead time*sales during lead time)
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Economic order quantity
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((2*Annual Sales*Cost per order)/Carrying cost per unit)^1/2
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SDLC
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Analysis
Design Implementation Training Testing Operations/Maintenance |
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7 Information Criteria
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Integrity
Confidentiality Efficiency Reliability Availability Compliance Effectiveness |
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COBIT Framework
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Direct: Plan and organize
Soution: Acquire and Implement Service: Deliver and Support Ensure Direction: Monitor and Evaluate |
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Real GDP
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Nominal GDP/GDL deflator * 100
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Factors that shift aggregate demand
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Wealth changes
Real interest rates Future Expectations Exchange Rates Govt Spedning Taxes |
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Multiplier effect
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1/(1-MPC)
1-MPC=MPS |
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Factors that shift SR agg supply
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Input prices
Supply shocks |
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GDP Expenditure Approach
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Govt Purchases
+Private investment +Personal COnsumption +Net Exprts |
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GDP Income Approach
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Income of proprietors
profits of corporations interest rental income adj for net freign income taxes wages depreciation |
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Unemployment rate
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# seeking/Total labor force
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Inflation rate
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(CPI current - CPI prior period)/CPI prior period
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Factors that shift demand curves
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Wealth
Price of related goods Consumer income Consumer taxes Expectations # of buyers |
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Factors that shift supply
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Price expecations of supplying firm
price of inputs price or demand of other goods we sell subsidies f taxes production tech |
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Price Elasticity of demand
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% change in quan demanded/ % change in price
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Midpoint method
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((Q2-Q1)/(Q2+Q1))/((P2-P1)/(P2+P1))
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Price elasticity of supply
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% change in quan supplied/% change in price
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Cross elasticityof demand/supply
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% change in # unit X demanded or supplied/% change in price of Y
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Income elasticity of Demand
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% change in # of units X demanded/% change in income
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Marginal Cost
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Change in Total cost/ change in quantity
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4 stages of Quality Reporting
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Prevention
Appraisal Internal failure External failure |
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APR
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Annual interest paid/ net proceeds
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Effective annual percentage rate
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((1+effective periodic Rate)^n)-1
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Simple interest
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Principal*interest rate per time period*# of periods
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Compound interest
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P*(1+i)^n
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Foreign Currency
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Foreign Dwn/Domestic Up= Inflows loss, outflows gain
Foreign Up/ Domestic Dwn= Inflow gain. outflow loss |
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Per share valuation
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Dividend/Req return
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Per share valuation with growth
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D1/(r-g)
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P/E Ratio
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P0/E1
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PEG
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P/E Ratio/G
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Price to sales
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P0/S1
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Internal Auditing performance standards
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Managing internal audit activity
nature of work engagement planning performing the engagement communicating results monitoring progress managements acceptance f risk |
