Instructions for ACL Problem 11-35
Click on open an existing project
Next: click ACL_Demo
Click on Metaphor_APTRANS_2002 file
To determine the total Invoice Amount column for comparison to the general ledger.
Highlight the total invoice amount column,
Relation between Current Ratio and Quick Ratio. The current ratio and the quick ratio
both use current liabilities in the denominator. Thus, the explanation most likely relates to the
numerator. The only differences in the numerator are that the curre
A. By dropping the interest rate to 4.5%, Busch would be saving $45,000. While this option would require
Busch to have a CPA review done, the cost of the review would still be only $20,000. Therefore, by tak
CH 9 HW
b. The statements arent acceptable because the estimations exceed the limit of 50,000.
c. The auditor should conclude the audit with a qualified opinion, tell the auditor to fix the
misstatements, or further investi
1. The business risks Enron faced were:
a) The risk of defaulting on debt from holding too much debt and not being liquid enough.
b) The risk of being insolvent due to the high level of debt to actual assets
These risks increased the likelihood o
CH 13 & 24
a. Audit B is considered to provide the maximum extent of reliance to be placed on internal control
because the clients internal controls are very effective. When the clients internal controls a
CH 6&7 HW
1. Plan and design an audit approach.
2. Perform tests of controls and substantive tests of transactions.
3. Perform analytical procedures and tests of details of balances.
4. Complete the audit and issue an audit report.
Case 4.1: Enron Corporation and Andersen, LLP
Enron borrowed funds without recording liabilities on the balance sheet. These
funds look like came from the sales of assets, and were guaranteed with Enron stock.
First, Enron only recorded the fu
OIL & GAS PRODUCTION AUDITING
Wayne C. Dussel
Offshore Measurement Supervisor
El Paso Production GOM
Basic Measurement Audit Steps
Select location (s) to be reviewed.
Review contracts, commingling agreements, process handling
Chapter 3 HW
a. Incorrect parts are allowed, however, they must be immaterial to the user.
b. True economic conditions are irrelevant. The statements must follow GAAP In order to be qualifie
CH 10 HW
A. Sales Transaction Related Audit Objectives
Occurrence: Approval is made by supervisor for all invoices, Approval is made by supervisor for all cred
Common-Size Analysis. Restating income statement line items as a percentage of sales
and balance sheets as a percentage of total assets enables the analyst to compare different firms
regardless of size. However, at least three possible limitations cou
Computing Cash Collections from Customers. (Amounts in Millions)
Sales and Interest Revenues for 2008
Plus Receivables at Beginning of 2008
Less Receivables at End of 2008
Cash Collections from Customers during 2008
Income Flows versus Cash Flows. The analysis below demonstrates that the change in
cash for the five years as a whole is $117,000. Subtracting the $100,000 cash contribution by the
owners equals $17,000, which equals the amount of net income for the f
Effect of Business Strategy on Common-Size Income Statement. Firm A is Dell and Firm
B is Apple Computer. The clues appear next.
Cost of Goods Sold to Sales Percentages. One would expect Dell to have a higher cost of goods
sold to sales percentage bec
Brief Summary of Sarbanes-Oxley Act of 2002
The Sarbanes-Oxley Act of 2002 affected the responsibilities of auditors, board of
directors, and managers with respect to financial statements. The Act also established the
Public Companies Accounting Oversight
CH 4 HW
b. Yes, rule 501, acting discreditable.
e. Yes, Joe needs a cooling off period of at least one year.
a. The audit committee is made up o
A. Auditors should plan and accomplish audit engagements to deliver reasonable assurance that the
financial statements of the client dont contain any material misstatement, whether from the result of
fraud or error. The difference between fraud and err
Materiality & Risk
Rina Hirsch, Ph.D., CPA
(Audit Command Language)
Auditors use Generalized Audit Software (GAS) to
perform testing when client files are in electronic form.
ACL is a commercially available GAS that is probably the