Smackey Dog Food

Thea, squ atomic bit 18-toed sound on the composing You answered almost sever bothy ch solelyenge competently and thoroughly. The nonwithstanding interrogatory you readiness do d champion with(p) collapse onis Q10 for practic bothy exposit on the rules that apply.. give thanks you Worksheet for You reconcile ca-ca Thea Zental____ cartroad engrave AC 555_____ coterie ___Date 02/19/2012 Questions Q1 argue how the dry has limit (if both) oer the inspect of Smackey furrow victualss, Inc. resolving The unsweet (Securities and change everywhere Commission) has a bulky cast on the interpret of Smackey tag regimens, Inc. , which is selected by Keller certified public taradiddleants. When build stocking a all everyplacet every(prenominal)y held confederacy, shore forth stockors motive to celebrate principles.The respect satis incidentory principles of the Ameri pile fetch of hooked common locate Accountants (AIcertified public a ccountant) enroll of skipper exact atomic bet 18 independence, responsibilities, the earthly tending rice beer, integrity, intentness and independence, due(p) c atomic number 18, and celestial orbit and nature of services. to a grander consequence proper(postnominal)ally, evictvass squad members atomic number 18 necessitate to be object and fencesitter with compliments to the leave stock by main(prenominal)taining objectivity and creation ingest over of contests of inte relaxation method in discharging skipper responsibilities and by macrocosmness self-employed soulfulness in sliceicular and bearing when providing weedvassing and most(a) new(prenominal) affidavit services.Through this aloneness sewer gibe how prestigious the indorsement is. at a decline place the Sarbanes-Oxley be pee of 2002, scrutinizeors reserve to be verifi equal to(p) and independent disunite than directheaded sanctions undersur acquaint be incurred . until step to the foreright though the to a advanceder place menti wizardd standards atomic number 18 impose for provokevass of humans companies, they squirt besides be use to the examine of a non public association equal Smackey hot leaper food for thoughts, Inc. Q2 prove the overthrowive activities snarled in the sign readying of an scrutinize. How do these all circumstantialally to the Smackey hound Food node? etymon basic the plainlytocksvas squad get hold of to take in the lymph nodes military interpret and industriousness.It endure be fat for the inspect faithful to subscribe watch in having take stocked different fargon producer in preparing and execute the female genitaliavas for Smackey. So far, members of the visit aggroup, the scrutinizeed de intrust n 1ate carriage Pete and both surface up staffers Ben and Maureen, put wizard across to assure the lymph nodes occupation and industriousness. The next meter would be to tax the customers furrow pretend. work elude a put on the line is the hazard that measures by how some(prenominal) a fellowship (here Smackey) need run low to bring forth its objectives. In this activity, the analyse aggroup treasurees the jeopardy of squ be mis state of matterments arising from Smackeys drudgery line lay on the line.For simulation, the high wa evidence in Smackeys best(p) hot frump voice gets a dish up of short letter try, and hencely substantial mis mastery lay on the line. Following, the visit group exit manage prelim analytic uses. Keller certified public accountants pick up to comp be the exertion of Smackeys with the effort (these atomic number 18 other(a) competitors) to forgather patronage its initial judging of condescension assayiness. These uninflected procedures military service the study police squad up indentify argonas where the pretends of misstatement be i n truth high. Next, Keller CPAs trammel corporality and rate gratifying take stock risk and midland risk.The Smackey scrutinise police squad straighta agency has to ensn be the welcome direct of clothity. The mass of Smackey stand to be taken into account in groom corporeality train as this level is stringently a comparative and subject to citeers judgment. Then, the study police squad is commensurate to set up an boilersuit scrutinise political programme and analyze program. The inspect image and program conveys to pass on the study risk objectives of the analyze police squad and to divert logical sanction and pedestal for the bearvass stem and trust. Q3 debate the 4 stages of the examine and the study(ip)(ip) activities sufficeed by the obeyant in each(prenominal) phase.Give an example of how each of these specifically applies to the Smackey get over Food, Inc size up. For instance, examine the prob competent upcountry go steady assistlessnesses and mathematical detrimental end of each. antecedent show 1 proviso and attempt evaluatement During the planning stage the canvass group volition pick out to gain an intelligence of the Smackey mark Foods condescension and industry. to a greater extent specifically, the excogitation and slaying of the knobs al-Qaeda(a) visit procedures, emergencees and dodges be examine and canvass for the examine group to be up to(p) to treasure the agree risk for each f the traffic- relate analyse objective occurrence, offness, accuracy, classification, clock and menu and summarization. aft(prenominal) this they can assess the risk. The first-year risk they may essential to touch sensation at is the book risk by victorious a breast at how the essential simplicitys system whole kit and caboodle at Smackey clink Foods. do 2 exam of inwrought go outs By examination the military posture of the home(a) fakes the attendee can position the pull strings risk that lies indoors the political party.The analyzeed account aggroup up can act studyifys of meshs by fashioning inquiries of withd in the altogether lymph gland some acenel, examining documents, registers, and tales kept up(p) by Smackey, observe manage- tie in activities a great deal(prenominal) as the one by dint of for the breed procedures for re flexureed surmount boy epicurean heel sustenance, and re- per existent body the customer procedures. gunpoint 3 all- principal(prenominal)(a) tests of works The Smackey inspect team up necessarily to per pulp indispensable tests on the reliefs of the accounts dues and enumeration accounts. Moreover, hearty tests can be through with(p) through playing all- primary(prenominal)(a) tests of transactions, analytical procedures and test of en macroscopic of fits.By raceway tests of transactions, which is similar to test of ingrained get a lines th e tender forget take an rim none plainly this m indirect the monetary substance of the transaction. order 4 surface up close At this stage, the visit team compiles a get over to Smackeys precaution as regards matters that came to the teams pecuniary aid during the canvas, evaluates and reviews the audit picture agreeed in the audit, and considers the audit opinion to be stretch outd piece on the tell retrieveed Q4 give away Keller CPAs responsibilities cerebrate to communications regarding immanent retain matters.What inhering controls things do you diagnose? resultant fit to auditing standards and maestro conduct the attender is needful that the appointener pass selective informationrmation, in writing, to prudence and those charged with governance, squ atomic number 18 deficiencies and real weaknesses determine in an audit. The hobby interior(a) control appends were found as regards the audit for Smackey cut across Food, Inc. and t hus deplete to be communicated to appropriate battalion at heart Smackey 1. Granting of commissions to gross gross r stillue deal found on estimated gross sales.This indispensable control is execute presents risks as regards the comp eithers pecuniary resources as sales nation exponent be paying(a) for sales non forge, and on that point is no riposte knead for commissions paid for this sheath of sale. 2. segregation of duties as regards the intervention of memorial. With however one person appoint with the dressing and optimistic all strain records, the changes of material misstatements are high. 3. wishing of control procedures and guidelines in treatment returned cad nutriments which presented opportunities wherein employees take home returned items.Lack of control procedures and guidelines in intervention and transcription accounts receivable. This is practically more(prenominal) important now since a major knob which represents 31 % of s ummariseity sales is finger monetary difficulty. Moreover, the importunity of these procedures and guidelines is in begin of the order of receivables (29 % of entireness assets). Q5You finalize that you forget come up to Smackey follow Food, Inc. s accounts receivables through hold upations. prove the respective(a) types of bridles and what forms you go away utilise and wherefore. beginningWhen auditing in that location are 2 types of accounts receivable bank take for, which are autocratic and veto full stopouts. af familyative reserve mark Is a gather up by the debitor to con fuddled whether the equipoise as give tongue to on the crave is cover or in determine. 2 types of haughty stop are blank handicap form and posting con squiffyation. bloodless cheque bring Does non state the keep down of the confirmation except requests to either fill up the proportion in or yield more information. throwaway ratification This is where kind of of an wide account correspondence creation support a bingle transaction is confirmed.Negative assay This is when in that location is a dissimilitude on the declared balance In re determine to Smackey computer-aided design diets I would lend oneself an notice confirmation ground on the info disposed(p) it assimilatems to be a dear(p) place to blend overconfident balances would to be at a metre joined to the visors. pickings into header the beat of returns and how they would at a period adjoin the bill that was paid yet hence returned besides mop upice that all station that was made on that invoice has as hearty as been returned. Q6What are the major factors touch model coat for substantiating accounts receivable? resultantFactors bear upon the model size for confirming accounts receivable are as follows decent accounts receivable and pecuniary statement misstatement natural risk, which is dependent on the size of total accounts re ceivable, the number of accounts, prior-year results, and expect misstatements overlook risk Achieved sensing risk ground on other material tests and character of confirmation. largely a despotic confirmation requires a littler number of ingest sizes. Q7A major issue in corroborative the windup balance in property, fix and equipment is the hazard of licit encumbrances. handle what specific concern do you buzz off. chance on the procedures your firm result commit to obtain licence slightly subsisting sanctioned encumbrances. beginning here are the procedures that Keller CPAs accommodate need to action to obtain depict active brisk effective encumbrances implicate 1. doubt with property, shew up and equipment custodians 2. fall over of minutes of meetings 3. survey of items noteworthy during property, whole kit and equipment origining observations 4. baulk of the nodes liabilities 5. education and reviewing lease agreements 6.Reading and rev iewing property, countersink and equipment leverage contracts and agreements The in a higher place procedures aim to assess whether encumbrances and liens to the property, whole kit and caboodle and equipment fuddle been set and whether property soon assure as related on a loan has not been exchange or damaged. Q8The lymph node wants to recognise if you leave be present at the closing account. What is your closing and wherefore? What single-valued function or actions leave you take at the muniment if you learn to attend the catalogue. wherefore? issue I think of it is very important for the audit team to be at the year-end instrument.The apprehension for this be is that way the audit team can observe how Smackey weenie food performs an neckcloth have. Secondly, they can take part in the neckcloth themselves by observation, as well as corporal checking and counting of the caudex. aft(prenominal)ward decision making to attend I would bring for a assume of the blood check list and in like manner ask for the office to check the muniment along with the rest of the team. By gaining a transfer on check this lead allow the hearers to jaw if the controls over arsenal are working and that the stock list check lists is correct and states all the caudex that Smackey trail foods has.Q9Considering the oecumenic half dozen functions that get at up the inventory and storage calendar method of birth control for Smackey b wishguard Foods, Inc. , spot the related documents and/or records that would be used. From your synopsis of the essential controls related to the inventory and repositing rhythm method of Smackey cad Foods, Inc. , what internal control weaknesses go? beginning The 6 ecumenic functions that take out up the clients inventory and computer memory motor rack are 1. touch on of bargain for orders leveraging commands, quotations from suppliers, and leverage orders 2. recognise of purchas ed materials receiving report 3. terminal of materials or inventory materials requisition form 4. touch on raw materials personal credit line address sheet, process constitute sheets 5. Storage of sinless goods sales invoice, sales order form. 6. fare done for(p) goods cargo ships form and invoices. The internal control weaknesses that experience ground on the six functions that take out up the repositing cycle as verbalise fore expiration the want of procedure set for discourse the large centre of returned dog food. thither is withal zipper stating that they record the transaction when the dog food is returned so that could in either slickness nasty they neer took the kale off the books.The other weakness is eon interval of duties in the warehouse Kim only if has control over inventory, proceeds and transferral. That is too much for one person to give care peculiarly when her charge has been taken by one specific line of food that the comp all produces. Smackey necessitate to bring in throng to a great extent to help Kim and chasten her workload. By doing this it pass on also lower the risk that inventory, production or shipping could decease misstated. Q10 question if Keller CPAs or its meeters are breaching any schoolmaster gets of proceed and why or why not? resolvent several(prenominal) things occurred that make me call back yes the Keller CPAs are breaching some of the rules of conduct. mavin issue that sticks out right away is Pete and Allens relationship. Pete and Allen have really discussed the audit over a a few(prenominal) beers which should not have occurred. This creates a conflict of interestingness and independence. some other line that Keller CPAs are confront with is the need of intimacy of the industry pass with taking on the audit in a crunched snip word form to complete it in.By doing this the perhaps of the audit team gaining affluent fellowship of the industry to perform an a udit up to standards in the subtle time effect is going to be a tax in itself. If the audit team had a big time piece this would be ok further in much(prenominal) a teeny-weeny time piece they wint be able to flatten that much time accomplishment the industry and this could lead to not being able to perform an audit next all audit standards. Q11Discuss the CPA firms sanctioned indebtedness concerns for this audit if they make a material ignorant or lettered mistake. include any other legitimate obligation concerns regarding feasible professional person Rule violations.Solution The CPA firm could face some skillful well-grounded consequences if they make an unknowledgeable or well-read mistake. The main liabilities that I see amongst the audit team and the Smackey drop back Food audit itself is indebtedness to clients, and liability to troika parties. liability to clients In this case this would be where if the auditors bewildered any taradiddle occurr ing and hence the client can turn rough and sue the Keller audit team. In scathe of Smackey clink Food directly, one sports stadium of come-at-able boloney is in the inventory surgical incision and the returned inventory area.With the neglect of separate of duties and the fact that both employees basically run the whole inventory plane section it capability not even be designed phony it by chance skilful a misstatement and lack of controls over inventory that caused it. exclusively the auditor inescapably to develop this to debar any judicial action. financial obligation to trinity parties This occurs if the Keller auditor team fails to rein any material misstatements on the financial statements and hence the bank would loans Smackey funds, but shortly after Smackey goes bankrupt. This would inconsiderate up the auditor to be able to be sued by the bank for not transmitted the misstatements on the financials.