This paper circulates around the core theme of discuss how a professionally skeptical auditor might interpret the situation. together with its essential aspects. It has been reviewed and purchased by the majority of students thus, this paper is rated 4.8 out of 5 points by the students. In addition to this, the price of this paper commences from £ 99. To get this paper written from the scratch, order this assignment now. 100% confidential, 100% plagiarism-free.
2-37 LO 3 For each of the following situations indicating heightened fraud risk, discuss how a… 1 answer below » 2-37 LO 3 For each of the following situations indicating heightened fraud risk, discuss how a professionally skeptical auditor might interpret the situation. a. The company is not as profitable as its competitors, but it seems to have good products. However, it has a deficiency in internal control over disbursements that makes it subject to management override. b. The company is doing better than its competitors. Although sales are about the same as competitors, net income is signifi- View complete question » 2-37 LO 3 For each of the following situations indicating heightened fraud risk, discuss how a professionally skeptical auditor might interpret the situation. a. The company is not as profitable as its competitors, but it seems to have good products. However, it has a deficiency in internal control over disbursements that makes it subject to management override. b. The company is doing better than its competitors. Although sales are about the same as competitors, net income is signifi- cantly more. Management attributes the greater profitability to better control of expenses. c. The company is financially distressed and is at some risk of defaulting on its debt covenants. The company improves its current ratio and other ratios by making an unusually large payment against its current liabilities, accompanied by highly discounted sales if their customers paid before year end. d. A smaller public company has a CFO who has centralized power under her. Her style is very intimidating. She is not a CPA; and she has limited accounting experience. The company has not been able to increase profitability during her time with the company. View less » Nov 30 2015 05:07 PM
