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nikdorinn [45]
3 years ago
5

Financial statement auditors provide some degree of assurance that financial statements are free of material misstatement. Many

investors believe this degree of assurance should be higher in cases of intentional misstatement such as fraud than for unintentional misstatement, such as honest mistakes in management’s accounting. Many auditors would point out that fraud is much harder to detect than honest errors because management tries to conceal fraud, but not honest mistakes. According to auditing standards, what degree of assurance do financial-statement auditors provide that there are no material misstatements due to intentional misstatements (e.g., fraud) versus unintentional misstatements (e.g., honest computational mistakes)?
Business
1 answer:
sineoko [7]3 years ago
3 0

Answer:

First of all, an auditor must be skeptical about the information that he/she is gathering and analyzing. They should try to get as much audit evidence as they can in order to form an opinion. But an auditor can also reasonably assure that there are no material misstatements, either intentional or not intentional.

Most auditor procedures are intended to discover unintentional misstatements, but intentional misstatements are very hard to discover because more than one individual (or even a very large group) might have colluded in order to conceal them. The auditor gets his information from the controller, internal auditor, and other people within the organization, but what if they all colluded in order to conceal their bad actions.

E.g. an auditor should check for shipping receipts to be complete, accurate and in order, but he/she relies on information given by the same people that he/she is evaluating. The auditor can conclude that the shipping reports are complete, but he/she cannot state that they are true and valid because he/she wasn't there.

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For each of the annual inflation rates given in the following table, first determine the new price of a movie ticket, assuming i
Mazyrski [523]

Answer:

  see below

Explanation:

The balance in Lucia's account is 1.05 times the original deposit, reflecting addition of 5% interest for the year.

The ticket price is the original price multiplied by (1 + inflation rate). The number of tickets that Lucia can purchase is the account balance divided by the ticket price. The quotient is rounded down to the nearest integer.

The "real interest rate" is the percentage change from the original number of tickets that could be purchased.

6 0
3 years ago
Which of the following is a characteristic of a well diversified portfolio?
Bogdan [553]

Answer:

c. very little unsystematic risk.

Explanation:

The first option is wrong because a diversified portfolio can only lockout unsystematic risk which is due to a particular business sector and not the risk emanating from the whole market which is systematic in nature.

The second option is also wrong because systematic risk cannot be diversified away.

8 0
3 years ago
The McMillan Development Corporation is in the preliminary stages of building a commercial office development. They have receive
solong [7]

Answer:

D. Both B and C

Explanation:

Based on the information provided within the question it can be said that you must go to The Building Codes  and Building Officials Conference of America. This is where every company must go in order receive the guidelines of the materials that are approved by the government for all development procedures including construction, electrical wiring etc.

4 0
3 years ago
You work for Emerita's Pizzeria and have been given the task of looking at company goals and deciding how the goals will be acco
Vesna [10]

The plans that must be involved are the strategic planning, the mid level, the low level, the operational planning, the top level planning.

Explanation:

In the strategic planning the company's stakeholders will ask them were they want their company to be in five years

The middle level staff will decide to focus in recruiting the new clients and to increase the productivity and they will find the way to give back to the company

Being a low level employee it is necessary that one must interact with the customers and contribute to the company's performance

In the operational planning it will be difficult to manage the customers  meet their day to day needs and satisfy them

A meeting will be held with the top level staff and hence they will be coming up with the new tools of the operational planning

3 0
3 years ago
A project will produce an operating cash flow of $136,000 a year for three years. The initial cash outlay for equipment will be
pashok25 [27]

Answer:

     NPV  =$ 60,311.80

Explanation:

<em>The net present value (NPV) of a project is the present value of cash inflow  less the present value of cash outflow of the project.</em>

NPV = PV of cash inflow - PV of cash outflow

We can set out the cash flows of the project using the table below:

                                                  0                  1                   2                 3          

Operating cash flow                                136,000     136,000    136,000

Initial cost                              (274,000)

Working capital                     (61,000 )                                          61,000

Salvage value                        <u>               </u>    <u>             </u>      <u>           </u>      1<u>5000  </u>              

Net cashflow                     <u> (335,000)  136,000      136,000      212,000.</u>

PV  inflow= (136000)× (1.1)^(-1) + (136,000× (1.1)^(-2) + (112,000)× (1.1)^(-3)

       =  395,311.80

NPV =395,311.80 -335,000

       =$ 60,311.80

3 0
3 years ago
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