Dr. Hwangs final audit 416 multiple choice form book
A review of vouchers paid during the month following the year end
An inquiry directed to legal counsel
Accounts payable confirmation
Mortgage note confirmation
The period in which the underlying cause of the litigation occured
The probability of an unfavorable outcome
An estimate of when the matter will be resolved
An estimate of the potential loss
Take no action regarding the event
Insist that the client issue revised financial statements
Inform the audit committee that the report cannot be relied on
Inform the appropriate authorities that the report cannot be relied on
Serve as an introduction to company personnel and an authorization to examine the records
Discharge the auditor from legal liability for the audit
Confirm in writing managements approval of limitations on the scope of the audit
Remind management of its primary responsibility for financial statements
Balance sheet date
Date of the auditors report
Date of the latest subsequent event referred to in the notes to the financial statements
Date of the engagement agreement
Prima facie evidence that the financial statements are not presented fairly
A violation of the foreign corrupt practices act
An uncertainty sufficient to preclude an unqualified opinion
A scope limitation sufficient to preclude an unqualified opinion
Balance sheet date
Date of the auditors report
Balance sheet date but before the date of the auditor's report
Date of the auditor's report and concern contingencies that are not reflected in the financial statements
Serious damage to the company's plant from a widespread flood
Issuance of a widely advertised capital stock issue with restrictive covenants
Settlement of a large liability for considerably less than the amount recorded
Decreased sales volume resulting from a general business recession
Feb. 27, 2010
Feb. 28, 2010
March 31, 2010
April 4, 2010
The auditor has no reporting responsibility concerning info accompanying the basic financial statements
The auditor should report on the info accompanying the basic financial statements only if the auditor participated in its preparation
The auditor should report on the information accompanying the basic f/s only if the auditor did not participate in its preparation
The auditor should report on all the information included in the document
To provide an opinion about the supplemental info when certain items are not in accordance with GAAP
To provide Rainco's creditors a greater degree of assurance as to the financial soundness of the company
To provide Rainco's management with info to supplement and analyze the basic F/S
To provide the documentation required by the SEC in anticipation of a public offering of Raincos stock
Issue a standard short-form report on the same audit
Include a description of the scope of the audit in more detail than the description in the usual short-form report
State the source of any statistical data and that such data have not been subjected to the same auditing procedures as the basic F/S
Maintain a clear cut distinction between management's representations and the auditor's representations
The cycle basis for physical inventory taking was to be used
Minor supply items were to be expensed when acquired
A perpetual inventory master file is not maintained for items of smaller value
The storekeeping function were to be combined with production and record keeping
Returned to the requisitioner
Forwarded to the receiving department
Forwarded to the accounting department
Retained in the purchasing departments files
Maintain a perpetual inventory master file of only the more valuable items with frequent periodic verification of the validity of the perpetuals
Have an independent CPA firm prepare an internal control report on the effectiveness of the administrative and accounting controls over inventory
Have separate warehouse space for the more valuable items with sequentially numbered tags
Require an authorized officer's signature on all requisitions for the more valuable items
Costs have been correctly assigned to finished goods, work in process, and cost of goods sold
Quantities on hand have been computed based on acceptable cost accounting techniques that reasonably approximate actual quantities on hand
Physical inventories are in substantial agreement with book inventories
The internal controls are in accordance with GAAP and are functioning as planned
Purchase requisitions
Receiving reports
Purchase orders
Vendor payments
Make inquiries
Inspect documents
Observe procedures
Consider policy and procedure manuals
Inquiry of sales personnel
Inquiry of store personnel
Physical observation
Review of perpetual inventory master files
Inadequacies in inventory pricing
Methods of avoiding cyclical holding costs
The existence of obsolete inventory
Physical quantity of inventory items
Average price of inventory items
Percentage of slow moving items
Dollar value of inventory
Physical quantity of inventory items
Periodic physical inspection of plant and equipment by the internal audit staff
Comparison of current-year plant and equipment account balances with prior-year balances
Review of prenumbered purchase orders to detect unrecorded trade-ins
Approval of periodic depreciation entries by a supervisor independent of the accounting department
Checks issued in payment of acquisitions of equipment are not signed by the controller
All acquisitions of factory equipment are required to be made by the department in need of equipment
Factory equipment replacements are generally made when estimated useful lives as indicated in depreciation schedules, have expired
Proceeds from sales of fully depreciated equipment are credited to other income
Continuous analysis of miscellaneous revenue to locate any cash proceeds from sale of plant assets
Periodic inventory of plant executives by internal auditors as to whether any plant assets have been retired
Continuous use of serially numbered retirement work orders
Periodic observation of plant assets by the internal auditors
Prior year accounts payable to current year accounts payable
Prior year payroll expense to budgeted current year payroll expense
Current year revenue to budgeted current year revenue
Current year warranty expense to current year contingent liabilities