Internal control

We are in agreeance that auditors should evaluate the soundness of a client’s business model. This would be an essential part of auditor’s inherent risk assessment process. The risk assessment is to understand the entity, its environment, and internal control to identify and assess the risk of material misstatement whether due to fraud or error at the financial statement and relevant assertion levels (AU-C Section 315, 2015) 2. Identify and briefly describe the specific fraud risk factors…

Gross Profit Reflection Paper When an organization face a froud, it is not an error for the guilty person; this is more a mistake from the own organization system. it might sounds conflicted, however, the management of the sytem is not well monitores or prepared for any mysterious activity. Of course there are several activities that an organization is not able to notice them because we are more concern and worried for those top amd big mistakes instead of the little ones. I have to mention that…

all the stakeholders with the help of effective internal control systems, policies and procedures lay the foundation of excellent corporate governance. Corporate governance concentrates on management as well as on shareholder’s wellbeing . Internal as well as external corporate governance helps organization in board culture, their share price in market, future need for raising capital and the most important is to gain shareholders trust. The internal and external check upon the company’s…

I’m currently the Contracting Officer Representative for United States Pacific Command and we use Information management systems help decision makers track projects from its formation to their execution. They provide them with pertinent information and collaborative tools that assist them formulate better assessments of projects based of past performances and future projections. Since most businesses use outdated management tools, which are not designed for managing complex projects, there is a…

WorldCom-type accounting scandals. The most important part of this Act is that it provides a new nonprofit company responsible for the inspection and sanction of audit firms; this is "the Public Company Accounting Oversight Board”. SOX led to a greater internal control of financial information, and an increase of independence among the boards, committees, and directors. Also, new requirements were imposed such as reports and audits. “The old ways weren’t working. That idea lit the corporate…

broken downs into 3 categories. One category is Audit Professional which represents the staffing compositions, qualifications, and review and supervision. Audit Processes is another category which falls under the umbrella of risk assessment, quality control, and monitoring activities. Audit Results is the final category that reviews financial statements & related…

The integration of the GAAS, the AICPA, the PCAOB and the IAS Background Information The Generally Accepted Auditing Standards refers to standards that are used to audit Private Corporations (Sunder, 2010 P. 100). The standards are divided into three categories. The categories include; fieldwork standards, reporting standards as well as general standards. The general standards address the individual’s qualifications to become an auditor as well as the minimum standards for the work product.…

Fraud Triangle The Fraud Triangle Theory created by Donald Cressey explains the three elements needed for fraud to be committed. These elements include opportunity, pressure or perceived pressure and rationalization. In the very publicized FIFA court case that included charges such as fraud, racketeering and bribery these elements were clearly present. According to The U.S Department of Justice (2015) , there was a total of nine FIFA Officials and five Corporate Marketing Executives who…

reasoning behind the risk was due to the measures taken by the chief executive to improve sales. The only way to generate sales to please Gill however was by recognizing revenue that was not recognizable. On the other hand, control risk was relatively low. However, the controls were not ineffective, rather it was from the results of the actions from the people in power. Due to the high inherent risk and the low detection risk, the detection risk would need to be low. Low detection risk would…

and board in general to effectively monitor and control management’s behaviour. Agency theory contends that management act in their own self-interest, even if it harms the shareholders interest (Jensen and Meckling, 1976). This is due to the separation of ownership and control (Fama and Jensen, 1983). Hence, the primary attributes for a board member from the agency perspective are independence from management, and expertise in monitoring and control (Cohen, Krishnamoorthy & Wright, 2002b). An…