What type of evidence do you think the auditor used

Assignment Help Accounting Basics
Reference no: EM132880147

Question - Imagine you were auditing Uber in the year that the company went public (2019). When doing the audit you found a misstatement in PPE. The company had recorded all of the drivers' cars as assets. Materiality on the Uber audit was $240M and the error was $500M. To record the PPE the company Dr. PPE and Cr. AP Employees. However, the company didn't plan on paying the employees for the cars. For the 2019 audit, Uber had a $4.5 billion dollar loss before tax stemming from $7.9 billion of revenue. Total PPE on the balance sheet was $1.6 billion and total assets were $24 billion. The company also recorded an impairment loss on their PPE and had $7B of long-term debt.

a. What report would you issue for the 2019 audit if this were the only unadjusted misstatement at the end of the audit? Fully justify your response.

b. What assertion is violated by the PPE misstatement? Explain your choice.

c. What type of evidence do you think the auditor used to determine that the PPE was misstated? In other words, how do you think the auditor uncovered this error? Explain.

d. Based on the information above, what are 2 OFSL risk factors that you would identify for Uber for 2019? Why do these factors impact OFSL and how?

e. What base do you think was used for materiality for the 2019 audit? What are two supporting reasons for your choice of base?

Reference no: EM132880147

Questions Cloud

Probability of rolling 6 times and getting 5 or more odds : 1. What is the probability of rolling the 8 sided die 6 times and getting: odd, odd, even, odd, odd, and even. in that exact order?
Determine the consolidated income : Assume further that the same separate profits were reported. Determine the consolidated income, the controlling share, and the non-controlling share
Describe the E-R diagram and REA data model : Describe the E-R diagram and REA data model in designing a database system for use in any one value-chain (sales, accounting, HR, purchasing etc.)
What does the initial plot of the data reveal : This assignment will use the SPSS dataset broadband_1.sav which contains time-series data for many separate markets. The dataset can be found in SPSS package sa
What type of evidence do you think the auditor used : What type of evidence do you think the auditor used to determine that the PPE was misstated? In other words, how do you think the auditor uncovered this error
Create an ethical strategy and standard for communication : Motivation, Satisfaction, and Performance, Identify team dysfunctions and develop appropriate interventions to drive enhanced organizational performance.
What is the difference in elevation between a and c : Lines AB and BC are on a straight line. The stadia intercept from A to B which are on the same level is 0.813 m. The stadia interval factor of the instrument us
What is the probability that on a given monday : On a typical monday, and average of 15.2 cars run a red light at a given intersection,
Prepare Pride Group consolidated statement : The carrying amount of the net assets of Spice at 30 April 20X8 was $5,500,000. Prepare Pride Group's consolidated statement of financial position

Reviews

Write a Review

Accounting Basics Questions & Answers

  Compute the amount of money

You invest $2000 in an account that pays simple interest of 4% for 30 years. Compute the amount of money you'll have at the end of 30 years

  Determine the amount of the recognized gain

Determine the amount of the recognized gain that is treated as § 1231 gain and the amount that is treated as § 1250 recapture (ordinary income)

  What amount should crazy puffs report as a liability

Crazy Puffs Cereal Company sold 1,000,000 boxes of cereal under a new sales promotional program. What amount should Crazy Puffs report as a liability

  Modern energy company owns several gas stations management

modern energy company owns several gas stations. management is looking to open a new station in the western suburbs of

  Prepare the journal entries

Prepare the journal entries and the shareholders' equity section of the balance sheet of Saturn Corporation as of December 31, 2014

  Determine the conversion cost per equivalent unit

Kool Inc. uses a weighted-average process costing system and has one production department. Determine the conversion cost per equivalent unit

  Total fixed overhead is 150000 most of the manufacturing

mountaineer products manufactures two types of tents single-wall and double-wall. selected data related to each type of

  Prepare journal entries to record costs of the equipment

During the second year of the equipment's life, $21,000 cash is paid for a new component expected to increase the equipment's productivity by 10% a year.

  What is the ending inventory at the end of each month

What is the ending inventory at the end of each month? Compare the units produced to the units sold and keep a running total

  The company''s return on assets

The Habicht Company was formed in 2009 to produce a single product. The production and sales for the next four years were as follows:

  Capwell corporation uses a periodic inventory system the

capwell corporation uses a periodic inventory system. the companys ending inventory on december 31 2013 its fiscal-year

  Compare the iasb and fasb in regards to convergence process

Compare the IASB and FASB in regards to the convergence process. Give your opinion on the reasons why a single set of accounting principles would be beneficial.

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