What controls should an organization

Assignment Help Accounting Basics
Reference no: EM13114568

It is common for an entity to have transactions with related entities - some of which are fully owned, some of which share common ownership, but are not otherwise related, and others where ownership is small but there is control.

A.        Devine related-entity transactions and describe the appropriate accounting for related-entity transactions.  In your answer consider the following:

  • Parent-subsidiary transactions
  • Affiliated entity transactions - owned by some owner (not a corporation)
  • Joint venture transactions
  • Special purpose entity transactions
  • Entity transactions with CEO (other than payroll)

B. There are two basic approaches to auditing related-entity transactions. Describe the approaches and evaluate the strengths and weaknesses of each approach.

C. Tyco is a conglomerate organization that had $36 billion in revenue.  In a court      trail, it was alleged that the CEO of the organization used corporate funds:

  • For a private birthday party (over $1 million)
  • To lavishly furnish an apartment in New York City
  • To pay domestic help for taking care of the apartment
  • To make loans to key executives that were subsequently forgiven by the CEO

            1.   What audit procedures would have identified these transactions?

            2.   It is reasonable o expect an audit to uncover these types of transactions in a $36 billion company?

            3.  Should the auditor look for these types of transactions in every audit?  Is it reasonable for auditors to look or such transactions?

            4.  What controls should an organization like Tyco implement to ensure that such transactions do not take place in the future? 

Reference no: EM13114568

Questions Cloud

Compute confidence level for difference in means : Compute a 95% confidence level for the difference in the means of the two treatment methods and select the best answer below. Assume that the independent random samples were taken from normal distribution.
Provide a possible explanation : Provide a possible explanation as to why this test identifies the presence of cytochrome c oxidase and not the other electron carries.
Compare and contrast how quality new products : Compare and contrast how quality new products/services are likely to be developed at a McDonald's versus a bank in your neighborhood.
Project probability with variance : A project has an expected duration of 34 weeks with a critical path variance of 6. Suppose the project network is given and the critical path is identified on the network. Suppose the normal time, crash time, and the associated cost for each activ..
What controls should an organization : What controls should an organization like Tyco implement to ensure that such transactions do not take place in the future?
Use t test for dependent means and independent means : For each of the following studies, say whether you would use a t test for dependent means or a t test for independent means.
How many kilograms of methane is present : How many kilograms of methane (CH4) are in perfectly insulated piston with the following properties: Volume = 2 cubic meters.
Describe the unwinding process or the synthesis : A piece of DNA has unwound and the ends of the two strands have begun separating for replication. Describe, in full detail, the discontinuous synthesis of the lagging strand.
Difference between data and information : Explain the difference between data and information. What is the difference between a population and a sample? List the different types of charts available in Excel, and explain characteristics of data sets that make each chart most appropriate to ..

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd