Description
Hello Can you Help me
First Assignment:
(Subsequent events) In connection with the audit of Flowmeter, Inc., for the year ended December 31, 20X0, Hirsch, CPA, is aware that certain events and transactions that took place after December 31, 20X0, but before Hirsch issues his report dated February 8, 20X1, may affect the company's financial statements.
The following material events or transactions have come to his attention.
- On January 3, 20X1, Flowmeter, Inc., received a shipment of raw materials from Canada. The materials had been ordered in October 20X0 and shipped FOB shipping point in November 20X0.
- On January 15, 20X1, the company settled and paid a personal injury claim of a former employee as the result of an accident that occurred in March 20X0. The company had not previously recorded a liability for the claim.
- On January 25, 20X1, the company agreed to purchase for cash the outstanding stock of Porter Electrical Company. The acquisition is likely to double the sales volume of Flowmeter, Inc.
- On February 1, 20X1, a plant owned by Flowmeter, Inc., was damaged by a flood, resulting in an uninsured loss of inventory.
- On February 5, 20X1, Flowmeter, Inc., issued and sold to the general public $2 million in convertible bonds.
Required
For each of the above events or transactions, indicate the audit procedures that should have brought the item to the attention of the auditor and the form of disclosure in the financial statements including the reasons for such disclosure. Organize your answers in the following format:
Second Assignment:
Please see attachment for resource Case 12.4
Resources: Case 12.4: Surfer Dude Duds, Inc.: Considering the Going-Concern Assumption
Prepare written answers that follow the case
Click the Assignment Files tab to submit your assignment.
I need original work and it is due this Sunday Night
Please let me know. I am offering $20 for both assignment
I will pay a downpayment of half and as soon as i receive the finished product I will run it through my plagiarism check and when it is all clear I will pay the remaining balance
Julie
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Explanation & Answer
Hello attached please find the two assignment responses. However you stated that i present the first assignment as an "inline image 1"..should that be from my end to you? i did not quiet get that..kindly advice
First Assignment
Transaction 1:
Audit procedures
Review the transactions to ascertain that they were recorded at the appropriate time of
shipment. In this case the materials are being received after the end of the financial year
and thus will be recorded in the purchases but inventory shall remain unchanged until
goods are received.
Vouch all purchases to ensure that it is supported by purchase orders, invoices, shipping
documents to verify the existence of accounts to support the transaction as well as the
accuracy of the purchases.
Verifying whether the materials were valued in accordance with the generally accepted
principles.
Determine the occurrence of the accounts payable in contrast with the present liabilities
in the Statement of financial position so that the amounts relating to this particular
shipment are recorded equally in the respective accounts.
Open items relating to accounts payables should be checked. This shall ensure that there
are no unvouchered purchases.
Disclosures
Transactions with regard to purchases/payables should be disclosed and any other
transaction that might be related with the accounts payable. Check for any footnotes
related to the purchase of the materials. These disclosures are to ascertain compliance
with the generally accepted accounting principles.
Transaction 2
Audit procedure
i.
Check on the accuracy of the claim amount.
ii.
Verify that the account has been timely recorded within the period of occurrence of the
injury/accident
iii.
Vouch to ensure the claim has been posted in the right liability account in the financial
statements such that the liability is recorded and payment is only recorded when the
claim has actually been settled.
iv.
Check to ensure appropriate valuation of the claim in relation to the injury incurred.
This helps to avoid over payment of the claim or undervaluation
v.
Ensure appropriate link up between the various parties involved so that there is clear
communication line and appropriate documentation relating to processing of the claim.
vi.
Check to ensure the presence of supporting documentations or evidence for the
occurrence.
Disclosure
These shall include inspection of the documentary evidence presented relating to the accident.
These should be accurate and verified by the appropriate departments. The documents for
review shall include accident report, risk assessment reports and health and safety assessment
reports. The disclosure shall communicate that the occurrence was actually proved beyond
reasonable doubt that it occurred and thus sufficient to process a claim.
Transaction 3
Audit Procedures
Check the accounts if properly updated with the acquisition, these will include;
inventory, accounts payable and cash accounts. This helps to determine completeness
of recording.
Vouch the purchase orders and cash disbursements for consistency and accuracy. In
such a case purchase orders, invoice and requisition forms will be of great importance.
Disclosures
Among the disclosures shall be an explanati...
