...Rigorous or Not?: A Case of Auditor Judgment for Deferred Tax Issues Leader’s Guide Leader’s Guide Rigorous or Not?: A Case of Auditor Judgment for Deferred Tax Issues Jan Taylor Morris, PhD, CPA Time: 3 hour unit of study Module Objectives 1. Help students understand the importance of exercising high quality professional judgment; 2. Introduce students to the KPMG Professional Judgment Framework; 3. Provide students with an opportunity to apply the framework; and 4. Provide students with the opportunity to begin developing an appropriate mindset for making good judgments. Module Learning Objectives Critical analysis of case issues and application of KPMG Professional Judgment Framework allow students to increase their: 1. Problem solving and decision making skills in an ambiguous learning environment; 2. Strategic / critical thinking as they consider the relevant issues of the case and make subjective decisions; 3. Ability to identify relevant risks associated with improper judgments; and 4. Understanding of ASC 740 and accounting for income taxes and how judgment impacts financial reporting. Module Components • Class Structure: 3 hour unit of study • PowerPoint Lecture • Case Assignment • Workpaper • Five Videos • Summary: Elevating Professional Judgment in Auditing and Accounting: The KPMG Professional Judgment Framework (available at: http://www.kpmguniversityconnection.com/ProfessionalJudgment/CurriculumSupport/Monographs/Professional-Judgment-Summary...
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...Rigorous or Not?: A Case of Auditor Judgment for Deferred Tax Issues Case Study Rigorous or Not?: A Case of Auditor Judgment for Deferred Tax Issues Jan Taylor Morris, PhD, CPA Riggers Inc (“Riggers, “client, or “Company”) is audited by Stone LLC CPA firm (“Stone” or “auditor”). The Compa” ” ny builds and owns offshore drilling rigs. Riggers is a US-based corporation that recently expanded its operations into Brazil (the only foreign-based operations for Riggers). As a result of this expansion, the client has encountered two complex issues related to accounting for income taxes. During the 2012 year-end audit, the auditors must use professional judgment with regard to these two income tax accounting issues. The first issue relates to the client’s valuation allowance against a net operating loss (“NOL deferred ”) tax asset (“DTA”) in Brazil. The second matter is the Company’s uncertain tax position resulting from transfer pricing in the United States. These two items require judgment on the part of management, thus the audit engagement team must apply the professional judgment framework during its year-end audit. Valuation Allowance As of December 31, 2012, Riggers has a $59+ million NOL carryforward on its Brazilian corporate income tax return. In 2011, Riggers had booked a $86,956 valuation allowance against the DTA established in recognition of the future tax benefit of the NOL, as the client believed it was not more likely than not (>50%) that that portion of the NOL future...
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...Rigorous or Not?: A Case of Auditor Judgment for Deferred Tax Issues Case Study Rigorous or Not?: A Case of Auditor Judgment for Deferred Tax Issues Jan Taylor Morris, PhD, CPA Riggers Inc (“Riggers, “client, or “Company”) is audited by Stone LLC CPA firm (“Stone” or “auditor”). The Compa” ” ny builds and owns offshore drilling rigs. Riggers is a US-based corporation that recently expanded its operations into Brazil (the only foreign-based operations for Riggers). As a result of this expansion, the client has encountered two complex issues related to accounting for income taxes. During the 2012 year-end audit, the auditors must use professional judgment with regard to these two income tax accounting issues. The first issue relates to the client’s valuation allowance against a net operating loss (“NOL deferred ”) tax asset (“DTA”) in Brazil. The second matter is the Company’s uncertain tax position resulting from transfer pricing in the United States. These two items require judgment on the part of management, thus the audit engagement team must apply the professional judgment framework during its year-end audit. Valuation Allowance As of December 31, 2012, Riggers has a $59+ million NOL carryforward on its Brazilian corporate income tax return. In 2011, Riggers had booked a $86,956 valuation allowance against the DTA established in recognition of the future tax benefit of the NOL, as the client believed it was not more likely than not (>50%) that that portion...
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...Research in general involves the investigation and analysis of an issue in question. The researcher usually applies reasonable and reflective thinking to develop an answer to the issue or problem at hand. Research requires a clear definition of the problem, using professional databases to search the authoritative literature, reviewing and evaluating the data collected, drawing conclusions and communicating your results. 2. Accounting, auditing, or tax research involve a systematic and logical investigation of an issue or problem using the accountant’s professional judgment. Furthermore, accountants approach this problem using critical-thinking skills to obtain and document evidence underlying a conclusion relating to an issue or problem currently confronting the accountant or auditor. 3. Accounting, auditing, or tax research are necessary in order to determine the proper recording, classification, and disclosure of economic events; to determine compliance with authoritative pronouncements; or to determine the preferability of alternative accounting procedures. 4. The objective of accounting, auditing, or tax research is a systematic investigation of an issue or problem utilizing the researcher’s professional judgment to arrive at appropriate and timely conclusions regarding the issues at hand. 5. Research plays an important role within an accounting firm or department. It is critical for the accountant/auditor to be able to find and locate applicable authoritative pronouncements...
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...Financial Highlights (In millions, except for per share amounts) Year-end 2011 2010 % B/(W) change Company sales Franchise and license fees and income Total revenues Operating Profit Net Income – Yum! Brands, Inc. Diluted Earnings Per Common Share before Special Items Special Items Earnings Per Common Share (a) (a) $ 10,893 1,733 $ 12,626 $ $ $ $ $ 1,815 1,319 2.87 (0.13) 2.74 2,170 $ 9,783 1,560 11 11 11 3 14 14 NM 15 10 $ 11,343 $ $ $ $ $ 1,769 1,158 2.53 (0.15) 2.38 1,968 Reported Diluted Earnings Per Common Share Cash Flows Provided by Operating Activities (a) See page 23 of our 2011 Form 10-K for further discussion of Special Items. Contents Dear Partners..................................................................................... 1 China and A Whole Lot More .......................................................2–5 Improving US Brand Positions .................................................... 6-7 Core Strategies ...................................................................................... 8 Business Model...................................................................................... 9 Taking People With You ..................................................................... 10 ABOUT THE PAPER USED FOR THIS REPORT The inks used in the printing of this report contain an average of 25% - 35% vegetable oils from plant derivatives, a renewable resource. They replace petroleum based inks as an effort to also reduce...
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...More Than a Numbers Game A Brief Histor y of Accounting Thomas A. King John Wiley & Sons, Inc. More Than a Numbers Game More Than a Numbers Game A Brief Histor y of Accounting Thomas A. King John Wiley & Sons, Inc. Copyright © 2006 by Thomas A. King. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions. Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability...
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...for financial statement auditors and related research questions Mark E. Peecher a,⇑, Ira Solomon b,1, Ken T. Trotman c,2 a Department of Accountancy, College of Business, University of Illinois at Urbana-Champaign, 1206 South Sixth Street, Champaign, IL 61820, United States A.B. Freeman School of Business, Tulane University, 7 McAlister Drive, New Orleans, LA 70118, United States c School of Accounting, Australian School of Business, University of New South Wales, Sydney 2052, Australia b a b s t r a c t We address the following overarching questions: What kind of accountability framework could regulators use to (a) motivate auditors to improve audit quality, and (b) evaluate how well auditors have carried out their duties? We draw on research in accounting, economics, psychology, and neuroscience to critique the accountabilities, incentives, and learning opportunities embedded in auditors’ extant regulatory environment. We first establish that forward-looking estimates are the basis for most financial statement information and that some of these estimates are highly uncertain, which increases the challenges faced by auditors. We propose an accountability framework with two dimensions: rewards versus penalties and processes versus outcomes. We show that auditors’ current regulatory accountabilities generally are in the form of penalties rather than rewards and primarily depend on audit outcomes rather than attributes of auditors’ judgment processes. We provide...
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...Vision/Mission/Core Values Notice of 54th Annual General Meeting Corporate Pro le Board of Directors’ Pro le Board of Directors’ Committees Directors’ Report Attendance of Directors Review Report on Statement of Compliance Statement of Compliance Pattern of Shareholding Categories of Shareholders Six-Year Summary Auditors’ Report to the Members on Unconsolidated Financial Statements Unconsolidated Financial Statements Auditors’ Report to the Members on Consolidated Financial Statements Consolidated Financial Statements Form of Proxy 93 95 35 37 02 04 06 07 14 16 25 26 27 29 31 32 committed to By enforcing excellent service, security and comfort PIA takes the time to nurture trust within its flyers. It is this very reason today that PIA is Pakistan’s favourite airline success annual general meeting Notice is hereby given that 54th Annual General Meeting of the Shareholders of Pakistan International Airlines Corporation will be held at 10:00 A.M. on Saturday, April 30, 2011 at Pearl Continental Hotel, Club Road, Karachi to transact the following business: 1. 2. 3. To receive and adopt the Audited Accounts for the Financial Year ended December 31, 2010 together with the Auditors’ and Directors’ Reports. To elect two Directors against vacancies as required under Sections 6 and 7 of PIAC Act 1956 in place of Mr Mubashir Iftikhar and Malik Nazir Ahmed who have completed their term of of ce of Directors. To transact any other business with the permission of the Chair. By order of the...
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...Notice of 2013 ANNuAl MeetiNg ANd Proxy stAteMeNt April 24, 2013 New orleans, louisiana Notice of 2013 ANNuAl MeetiNg of sHAreoWNers Time and Date: 10:00 a.m. central time, April 24, 2013 Location: ernest N. Morial convention center, 900 convention center Blvd., New orleans, lA 70130 March 13, 2013 Dear Shareowners: You are invited to attend General Electric Company’s 2013 Annual Meeting of Shareowners to be held at the Ernest N. Morial Convention Center, 900 Convention Center Blvd., New Orleans, LA 70130, on April 24, 2013, at 10:00 a.m. Central Time. Following a report on GE’s business operations, shareowners will vote: • to elect the directors named in the proxy statement for the coming year; • to approve our named executives’ compensation in an advisory vote; • to ratify the selection of our independent registered public accounting firm for 2013; and • on the shareowner proposals set forth on pages 44 through 49, if properly presented at the meeting. Shareowners also will transact any other business that may properly come before the meeting. You are eligible to vote if you were a shareowner of record at the close of business on February 25, 2013. Please ensure that your shares are represented at the meeting by promptly voting and submitting your proxy by telephone or the Internet, or by completing, signing, dating and returning your proxy form in the enclosed envelope. If you plan to attend the meeting, please follow the advance registration instructions under...
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...ANNUAL REPORT 2010 -11 TECHNO_LOGICAL TECHNO_LOGICAL In many ways, satisfying the Indian customer is probably much more challenging than satisfying a customer in another market. The country has an obsession for fuel efficiency, when it comes to choosing automobiles (and rightly so, since about three-fourths of India’s crude oil requirement is imported). Extracting more mechanical energy for the car from every drop of fuel is a designer’s challenge. But it is vital for the consumer, the economy and the planet. At the same time, a fast growing, young and upwardly mobile, speed conscious India demands pick-up and instant response at the accelerator pedal. There is normally a trade-off between performance and fuel efficiency. A third requirement is space efficiency, as customers want the car to be compact to cope with congestion on roads and parking lots. Yet another requirement is of minimizing emissions. The Company’s next generation, K-series engines employ a plethora of state-of-theart technologies to deliver on all these fronts. Technologies deployed could be as sophisticated as fine atomization to achieve fuel droplet diameter in microns for optimised combustion. Or, they could be as practical as using engineering polymers instead of metal in certain engine parts for weight reduction. Quite like packing more performance in a handheld smartphone as opposed to a traditional laptop. India’s road and dust conditions, the rains and driving safety considerations similarly...
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...Regulation, Corporate Governance, and Audit Quality 1. The auditor is not responsible for the presentation of financial statements; therefore, the auditor has no responsibility for fraud in the financial statements. FALSE 2. An example of fraudulent financial reporting is the CFO intentionally overstating sales to boost profits. TRUE 3. The auditor is responsible for actively considering fraud risks in order to obtain reasonable assurance that the financial statements are free of material fraud. TRUE 4. Auditors need to consider fraud arising from misappropriation of assets and fraudulent financial reporting. TRUE 5. Fraud is an intentional act involving the use of deception that results in a material misstatement of the financial statements. TRUE 6. An example of fraudulent financial reporting is the treasurer's diversion of hundreds of thousands of dollars into a personal money market account. FALSE 7. BruceCo. has accounted for the revenue of Jiffy Mac, Inc., one of its suppliers as though it were its subsidiary. BruceCo. has probably committed fraud because of its misapplication of consolidation principles. TRUE 8. Consideration of fraud in financial statement audits is a relatively new concept derived originally from the Sarbanes-Oxley Act. FALSE 9. The most important lesson to be learned from The Great Salad Oil Swindle is that auditors can commit fraud by falsely including inventory that does not exist...
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...cover next page > title author publisher isbn10 | asin print isbn13 ebook isbn13 language subject publication date lcc ddc subject : : : : : : : : : : : cover next page > < previous page page_i next page > Page i Dictionary of Accounting Terms Third Edition Joel G. Siegel, PhD, CPA Professor of Accounting Queens College of the City University of New York Jae K. Shim, PhD Professor of Accounting College of Business Administration California State University, Long Beach < previous page page_i next page > < previous page ACKNOWLEDGMENTS page_ii next page > Page ii The authors would like to acknowledge the contributions made by reviewers John Downes, formerly of the New York City Office of Economic Development, and Dr. G. Thomas Friedlob, Professor of Accounting at Clemson University. Their in-depth evaluations have been of great importance to the technical accuracy of the manuscript. Gerald J. Barry suggested many meaningful insertions and deletions that greatly enhanced the authors' prose. Thanks also go to Roberta Siegel and Cher Ragge for their assistance with the computer terms, graphics, and word processing. Anna Damaskos, Don Reis, Sally Strauss, and Eileen Prigge of Barron's have been invaluable during the many stages of editing the manuscript into its bound book form. © Copyright 2000 by Barron's Educational Series, Inc. Prior editions © 1995, 1987 by Barron's Educational Series, Inc. All rights reserved. No part of this...
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...Auditing Cases An Interactive Learning Approach FIFTH M F S D E D ITIO N S. B A. B M. G F. P Boston Columbus Indianapolis New York San Francisco Upper Saddle River Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto Delhi Mexico City Sao Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo Editor in Chief: Donna Battista Acquisitions Editor: Stephanie Wall Editorial Project Manager: Christina Rumbaugh Senior Managing Editor: Cynthia Zonneveld Production Project Manager: Carol O'Rourke Senior Operations Supervisor: Diane Peirano Printer/Binder: BindRite Graphics, Robbinsville Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on the appropriate page within text. Copyright © 2012, 2009, 2006, 2003, 2000 by Pearson Education, Inc., publishing Prentice Hall. All rights reserved. Manufactured in the United States of America. This publication is protected by Copyright, and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise. To obtain permission(s) to use material from this work, please submit a written request to Pearson Education, Inc., Permissions Department, One Lake Street, Upper Saddle River, New Jersey 07458, or you may fax your request to 201-236-3290. Many of the designations by manufacturers and sellers to distinguish...
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...Performance at a glance 4 Awards & honours 5 Chairman’s message 6 Board of directors 7 CEO (International) & JMD’s message 8 CEO (India & South Asia)‘s message 9 Together good things happen 10 Corporate social responsibility 11 Directors’ report 12 Management discussion & analysis 13 Report on corporate governance 14 Secretarial audit report 15 Standalone financial statements with Auditors’ report 16 Consolidated financial statements with Auditors’ report 17 Notice of annual general meeting 2 3 4 5 6 8 12 14 18 24 32 40 46 63 64 115 159 1 Corporate Board of directors Sunil Bharti Mittal Chairman and Managing Director information Group General Counsel & Company Secretary Vijaya Sampath Statutory Auditors Manoj Kohli CEO (International) & Joint Managing Director Non-executive directors Ajay Lal Akhil Gupta Arun Bharat Ram Chua Sock Koong Craig Edward Ehrlich Lim Chuan Poh N. Kumar Nikesh Arora Pulak Chandan Prasad Rajan Bharti Mittal Rakesh Bharti Mittal Tan Yong Choo CEO (India & South Asia) Sanjay Kapoor S.R. Batliboi & Associates, Chartered Accountants Auditors – US GAAP Ernst & Young Internal Auditors PricewaterhouseCoopers Private Limited Registered & Corporate Office Bharti Airtel Limited, Bharti Cresent, 1, Nelson Mandela Road, Vasant Kunj, Phase – II, New Delhi – 110 070, India Website http://www.airtel.in Bharti Airtel Annual Report 2009-10 Corporate history and Top 30 shareholders Corporate history Mobile services under the brand name ‘Airtel’ launched...
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...08 10 12 buSineSS review insight into each of our business units SuSTainabiliTy and governance information on our organisation structure, management team, corporate governance, risk management and sustainability efforts 16 24 30 36 Board of Directors Organisation Structure Management Committee Senior Management Sustainability and Governance Philosophy Corporate Governance Investor Relations Risk Management Philosophy and Approach Sustainability 39 44 45 48 49 50 70 72 80 Group Consumer Group Enterprise Group Digital L!fe Key Awards and Accolades performance our performance at a glance financialS audited financial statements for the year ended 31 march 2014 89 91 92 Directors’ Report Statement of Directors Independent Auditors’ Report Consolidated Income Statement Consolidated Statement of Comprehensive Income Statements of Financial Position Statements of Changes in Equity Consolidated Statement of Cash Flows Notes to the Financial Statements 102 110 111 112 113 114 116 120 123 addiTional informaTion Shareholder and corporate information, as well as contact points for our offices worldwide Interested Person Transactions Shareholder Information Corporate Information Contact Points 205 206 208 209 Group Five-year Financial Summary Group Value Added Statements Management Discussion and Analysis ovERviEw ANNUAL REPORT 2014 BUSiNESS REviEw SUSTAiNABiLiTy AND govERNANCE PERFoRmANCE FiNANCiALS ADDiTioNAL iNFoRmATioN 1 our vision To...
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