Auditing Midterm Exam Page 1: Question: 1. The objective of the ordinary audit of financial statements is the expression of an opinion on: | | the fairness of the financial statements | | CORRECT | | | the accuracy of the financial statements | | | | | the accuracy of the annual report | | | | | the balance sheet and income statement | | | 2. The auditor's best defense when material misstatements are not uncovered is to
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accomplish this. Accounting Principles In health care organizations, financial reporting involves financial statements. There are four main financial statements. They are: (1) balance sheets; (2) income statements; (3) cash flow statements; and (4) statements of shareholders’ equity (U.S. Exchange Commission, 2011). The third part of a cash flow statement shows the cash flow from all financing activities. It is very important for an organization to report their finances, since financial
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that the FASB’ CF is a fundamentally flawed approach and should not be adopted in its present form. The AAA reviews and analyzes the FASB’ Preliminary Conceptual Framework in nine parts and gives its comments (COM). 1) The CF cites the users of general purpose financial reports are present and potential investors and creditors. The AAA suggests the users should be the owners of enterprises and requires independent certified public accountants to adhere to GAAP. 2) The CF cites the primary use of
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Valuation and Capital Budgeting Part I Capital Budgeting M. Lambert Valuation and Capital Budgeting Part I, HEC-ULg 2013-2014 – Marie Lambert 1 Real investments • Real investments are expenditures that generate cash in the future and, as opposed to financial investments, like stocks and bonds, are not financial instruments that trade in the financial markets • Corporations create value for their shareholders by making good real investment decisions Valuation and Capital Budgeting
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General Accepted Accounting Principles to International Financial Reporting Standard: The Potential Change for Leasing The United States, via the US Financial Accounting Standards Board (FASB), International Accounting Standards Board, and SEC all have begun the process to migrate from General Accepted Accounting Principles (GAAP) to the International Financial Reporting Standard (IFRS). This migration has advocates for and against the change. A major change in the IFRS proposal is the accounting
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Chapter 2 – The Recording Process Questions – 1-21, Pages 78-79 1. Describe the parts of a T account. T account consists of three parts: (1) a title, (2) a left or debit side, and (3) a right or credit side. Because the format of an account resembles the letter T, we refer to it as a T account. 2. “The terms debit and credit mean increase and decrease, respectively.” Do you agree? Explain. I do not agree. We use the terms debit and credit repeatedly in the recording. Debit simply means
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is typically included? 1. Description of the company’s business and risk factors 2. Management’s Discussion and Analysis (MD&A) 3. Comparative Financial Statements (including notes to financial statements) 4. Independent Auditor’s Report on Financial Statements 5. Management’s Report on Financial Statements and Internal Controls 6. Auditor’s report on internal controls 7. Who develops financial reporting standards in the U.S.? That is, who influences Generally Accepted
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the SUA packet of materials Documents Folder location of Employee Earnings Subsidiary Ledger in the SUA packet of materials SUA Instructions, Flowcharts and Ledgers location of Cash Receipts Journal in the SUA packet of materials SUA Journals location of General Ledger in the SUA packet of materials SUA Instructions, Flowcharts and Ledgers The reason for not permitting a person who has temporary or permanent custody of an asset to account for that
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of the four basic financial statements has three main sections: one dealing with operating expenses, another dealing with financial activities, and another dealing with investment activities? a. 0 Income statement b. 0 Retained earnings statement c. 0 Balance sheet d. 0 Statement of cash flows 2. Which of the following lists the main sections of the statement of cash flows? a. 0 Operations, investment, and credit activities b. 0 Investments, credit, and cash operations c. 0 Operations,
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CORPORATE FINANCE DEMYSTIFIED TROY A. ADAIR, Jr. McGraw-Hill New York Chicago San Francisco Lisbon London Madrid Mexico City Milan New Delhi San Juan Seoul Singapore Sydney Toronto Copyright © 2006 by The McGraw-Hill Companies. All rights reserved. Manufactured in the United States of America. Except as permitted under the United States Copyright Act of 1976, no part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system
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