Saturday, December 7, 2019

Auditing and Assurance Services Audit Inherent Risk Model

Question: Describe about the Auditing and Assurance Services for Audit Inherent Risk Model. Answer: Meaning of Inherent risk: Inherent Risk is the risk of a material misstatement in the financial statements arising due to error or omission as a result of factors other than the failure of controls (factors that may cause a misstatement due to absence or lapse of controls are considered separately in the assessment of control risk). Factors that would have contributed to increased inherent risk assessment at the financial reporting level: Competence and Integrity of management: At financial reporting level, many disclosures in financial statements, policies, trade practices etc. Are based on management judgement and their approach towards future economic growth. Say few estimates are to made to disclose true picture of financials i.e provision for employee benefits, provision for expenses etc Assessing management integrity is no easy task but at financial reporting level, inherent risk of audit increases if competence and integrity of management is found to be low by the auditor. As mentioned in the question, due to rapid industry growth in the industry, significant managerial experience in the industry was limited. Thus, due to limited experience management may not get proper solutions for complex situations arising in the business or it may not be able to estimate future trends and technologies of which management of competitor entity are aware of. Discrepancies in accounting records: It may happen that the accounting records are maintained properly in an entity. Say for example, there are many errors and omissions in the accounting records. Due to this factor, financial position as at reporting date may be mislead to an large extent Discrepancy in accounting records affects can effect any component of financial statement i.e. revenue, expenditure of any other balance sheet or profit and loss item. Thus, if any discrepancies are found in accounting records inherent risk of audit will be assessed as high. In case of inexperienced accounting personnel, it may happen that accountants are not clear at entry level only. They may get confused in debit and credit entries. Thus, it may cost discrepancies in accounting records. The trail balance of the company may not tally, account balances may not represent actual account balances, etc. which increases inherent risk involved in audit at financial reporting level. Unusual relationship between auditor and management: An audit involves reporting on financial statements of an entity whether they are true and fair independently. If there is any indication of unusual relationship between auditor and management i.e. high volume of transactions between both, old friendship or relationship between auditor and management. Etc may affect the independence of auditor and the auditor may not report the actual picture of financial statements and he may end up reporting in favour of the entity. Thus, this factor increases inherent risk of audit. The indicators of unusual relationships may be recurring cash transactions between auditor and the company, auditor and company are related parties, etc. Unusual transactions with outside or significant related party transactions: Related parties are parties which are mainly controlled by common controlling authority. It may happen that, for personal benefits directors may transfer profits of one entity to other. Or it may happen that they sell products of one company to other related party at cheaper rates to make other entity profitable. Thus, in case if at the beginning of audit, the auditor finds large volume of transactions with related party or any unusual transaction with related party, he may classify inherent risk of audit as high. There may be some transactions with external parties identified at the start of audit or during the course of audit which are unusual in nature. For example, a transaction not related to business, high cash value transaction or other transaction which the auditor may find unusual increase the inherent risk of audit. These transactions may also impact financial position of an entity. Thus, occurrence of such unusual transactions increases the inherent risk of audit. Further, if transactions with related parties are high in volume also affect the inherent risk involved in audit. As the entity has interest in its related party, the transactions may not be arms length price or it may happen that funds are transferred from one entity to other and share holders funds are used for related party of the entity. Such kind of transactions increase the inherent risk involved in a audit at financial statement level. Financial results that seem too good to be true: In some cases, financial results of a company seem too good i.e financial position of the company seems too good as compared to industry trends and companys internal financial structure and capability of the management. For example, average profit in industry is 10% but the financial of the entity are showing profit of 40 %. This kind of situations leads to more complex judgements by the auditor. Thus, if financial results seem too good to be true, the inherent risk in audit will increase. The company may display wrong picture in financials to attract shareholders, investors and customers towards services. It may happen that, to attract large investments, profit of the company is disclosed doubled or the liquid ratio is disclosed favourable to the company. Though, the auditor through his professional scepticism may identify that such financials are not in line with current financial position of the company of industry. Thus, he may have to perform additional audit procedures to ensure the financial results disclosed by the company are true and fair. Factors which would have identified at strategic planning level: Competency and Integrity of management: Management can plan and divide work in such a manner that expert in particular work in allotted to the work matching with his expertise. Discrepancies in accounting records: Management can set up controls for accounting at strategic planning level. Solution: Inherent risk factors that would have contributed to increased inherent risk assessment at the account balance level: Account represents an asset that can be easily stolen: There may be a case where assets of the entity are kept or maintained in such a way that they can be easily stolen. For example, company keeps few of its machines outside the factory due to storage issues in factory and no security is there to keep watch on that machines which are kept outside the factory. Now there may be a case where this assets are stolen and the auditor even the company is not aware of the case. In such situations, it may happen that auditor reports gross block of assets as 1,00,000$ and only assets worth 97,000$ are available physically. This increases the inherent audit risk at account balance level. Fixed assets cover a major portion of entitys financials. If fixed assets are not disclosed properly in the financials, there is high risk of misrepresentation of the companys financial position. Thus account balances represent assets that can be easily stolen, it is high risk item for an auditor and thus it increases inherent audit risk at financial statement level. Account balance made up of complex transactions: If any account has complex entries and account balance is not clear or the nature of transactions in that account is not clear to auditor the auditor has to perform additional procedures to comment on true and fair view of that account. For example, an account used for accounting of taxes and proper narration is not given to entries in that account, it may happen that auditor finds that account very complex and perform additional procedures to get comfort on the figures of that account. Further, it is also possible that technical knowledge of accountant is less and entries of expenses are routed through the ledger of tax. Such cases increase the inherent audit risk at account balance level. Account balance requires a high level of estimation to value: There are some transactions in which proper estimation by management is required to complete the accounts so that false picture financial position of the entity is not reported. Examples of such kind of estimations are provisions for expenses accrued but not due, provision for gratuity, contingent liability, etc. If the company is incurring high volume of expenditure at the year end of which exact payment to be made for that expenditure in not know by the management, management estimates become more crucial in depicting the financial picture and thus it increases the inherent risk of audit. Other Factors: Account balance subject to adjustments that are not in the ordinary processing routine: Financials are finalised after making some adjustments in accounts for presentation of financial statements to comply with reporting standards. If the accounts are too complex and many adjustments are required in that for proper disclosure, probability of error increases and inherent risk of audit also increases. Account balances are composed of high value of non routine transactions: In such cases it becomes difficult for auditor to easily rely on account balances as it consists of unusual transactions which are not in course of business. Auditor has to perform additional audit procedures to insure that balance in such kind of accounts is true and fair. Solution Comment on going concern of business enterprise: Going concern if affected by the following: Stability of business: If there is any indication of any future or current event which may impact operations of business substantially going concern concept is affected.. For example, if any new product is launched in market which is better than the companys product and company is not able to upgrade its product due to limitation of resources, it may happen that customers start buying new product in market and demand of companys product decreases drastically. In case of Nokia, the company was not able to upgrade with technology and it continued with old technology and ended up being sold to Microsoft. There are many other factors which affect the going concern assumption of business entity such as continuous losses to the company, internal work environment of the company shows possibility of lock out, strike of worker etc. In case of One Tel(Given company in the question) going concern is assessed as low due to following factors: Australias telecommunication sector is already well grown and many telecom companies are operating in the market with big investments and well skilled man force. Further, Telstra is holding major customer share in market. Along with Telstra there are many players in the market in this sector. In such kind of markets and such kind of business scales it becomes very difficult for new enterprises like Telstra to operate in market and sustain growth continuously. Considering the mobile operators in Australia, 42% of the population is already using mobile phones. In such case it becomes difficult to attract new customers as many of the customers are already using the service and One Tel has to launch a very attractive productservice to attract the buyers. Due to the rapid growth of the industry described in the previous section significant managerial experience in the industry was limited. This is most important factor for an enterprise to continue in a competitive market. It may happen that, management fails to attract customers with its products as management of competitor is more efficient than one tel. Decision making may fail due to lack of experience. In complex situations, management decisions play crucial role, and if management is not competent enough to cope with situation, the company may suffer heavy losses. One Tel is operating in a competitive business environment where already many businesses are already established one tel will start establishing its business from this point. Considering the market share of competition and experience of the competitors it is tough job for one tel to establish a customer base and sustain in such a competitive market and achieve growth along with earning profits. References:, S 2014, Audit Risk Model: Inherent Risk, Control Risk Detection Risk, viewed 19 September 2016, Investopidea, S 2015, Examples of inherent risk, viewed 19 September 2016, The, S 2015, Inherent Risk in Audit, viewed 19 September 2016, Wikipedia, S 2016, Audit Risk, viewed 19 September 2016,

Saturday, November 30, 2019

Themes of Judgement in Fahrenheit 451 Essay Example

Themes of Judgement in Fahrenheit 451 Paper In the book called Fahrenheit 451 by Ray Bradbury, the motif of judgment is a reoccurring idea. Montag judges the appearance of society like a typical citizen until he realizes the importance of contents through his discovery of books. The perspectives are interchanged when society judges Montag back due to his action of joining Granger’s community. Montag’s search for knowledge destroys the ignorance he used to follow blindly and changes his views to a different world of judgment. Montag makes a typical judgment from the cover of society by conforming to its expectations. He happily burns books due to the propaganda of society teaching the citizens that books are bad for their health because â€Å"the city has never cared so much,† (Bradbury 154) until meeting Clarisse. Her curiosity leads to Montag questioning the existing political system of society. His new perspective is the start of him looking beyond the cover of the metaphorical book about society towards the problems of restricted freedom, independent thought, individuality and dissent. He reads books illegally to learn the meaning of their contents. Montag discovers the wonderfulness of books and their meaning to life. He learns looking at the contents is better than to â€Å"judge a book of [his society] by its cover† (Bradbury 155).Montag does not judge Granger’s group on arrival unlike the society.The men of Granger’s group appear like hoboes that do not know anything d ue to their â€Å"stink like a bobcat† (Bradbury 147) and bearded faces. As a result, they are easily overlooked by the government of society because â€Å"there’s nothing to incriminate† (Bradbury 152) them. But in reality, they contain all the information that is restricted in society within them. The society continues to judge Granger’s community until it â€Å"rolled over and fell down dead† (Bradbury 160). On the other hand, Montag and Granger’s group are the only citizens, who stop jud We will write a custom essay sample on Themes of Judgement in Fahrenheit 451 specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Themes of Judgement in Fahrenheit 451 specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Themes of Judgement in Fahrenheit 451 specifically for you FOR ONLY $16.38 $13.9/page Hire Writer

Tuesday, November 26, 2019


Aztecs Free Online Research Papers The Aztec language was called Nahuatl. The Aztecs developed a system of pictures which they used as sort of an alphabet. They had hundreds of different symbols to use in their vocabulary. Nouns were easy to draw they drew a cat as a cat and drew a fish as a fish and so on. They joined them together to form sentences, and used them to write down stories and keep records. Words that joined the nouns into sentences were extremely difficult to draw. The art of writing was very specialized and also difficult to learn. Scribes needed to know a lot of extra information that wasnt written down because the pictograms only gave a clue to the full meaning. Aztec picture writing was mainly done by priest or scribes. They were the only ones who could read the pictures. The pictures were then brightly colored with vegetables, minerals, insects and shells. As early 600AD the language was known. These language speakers came from the north in waves, settling in Central Mexico. The Nahuatl speakers were the dominant power. One of the last Nahuatl speaking groups to come to the area was the Mexica. One of the last Nahuatl speaking groups to come to the area was the Mexica, who would become a powerful force in the founding of the Aztec empire. The Aztec language was part of a larger group of Indiana languages. Other languages included in the same group as the Aztec language are Pima, Comanche, and Shoshone. Aztec writing was not developed enough to express complete ideas or expressions. Aztec numbers were also an important part of the Aztec language. Numbers were used for the calendar and in the use of mathematics, making them an equally important part of the Aztec language. Despite the fact that the Aztec alphabet was not fully developed, poetry was an important aspect of the culture. In fact, Aztec poetry was referred to as â€Å"flower and song† because these were metaphors for art and symbolism. The theme of cut flowers was regularly used to symbolize the temporary fragility and beauty of existence. Nezahualcoyotl was considered by his peers to be the greatest poet of ancient Mexico. His compositions had vast influence, stylistically and in content. Filled with thought, symbol, and myth, his poetry moved his peoples culture so deeply that after his death generations of poets to follow would stand by the huehuetl drum and cry. Research Papers on AztecsQuebec and CanadaAssess the importance of Nationalism 1815-1850 EuropeHip-Hop is ArtCanaanite Influence on the Early Israelite ReligionComparison: Letter from Birmingham and CritoAnalysis Of A Cosmetics Advertisement19 Century Society: A Deeply Divided EraMind TravelBook Review on The Autobiography of Malcolm XHonest Iagos Truth through Deception

Friday, November 22, 2019

How to Become More Fun If You Think Youre a Boring Person

How to Become More Fun If You Think Youre a Boring Person In this post we’re going to go through a 5 step process that can quickly turn even the most boring person into a real lively individual. No kidding. We start by tackling your self-identity and then move on to your mortality and chasing fears with a big fat smile on your face. Sound fun? Yeah, that’s part of it. Let’s begin! 1. Step Outside Your Old Personal Narrative This is one of those quotes we all need to write down somewhere and look at regularly until we memorize it. If you want, just read it aloud ten times in a row and chances are you’ll never forget it (the beauty of propaganda): â€Å"I’m not what I think I am. I’m not what they think I am. I’m what I think that they think I am.† Get it? Keep reading it until you do and once that light bulb goes on above your head your life will instantly change. You’ll then realize you can be†¦anyone you choose†¦anytime you choose. Your old personal narrative is the elevator pitch you tell yourself when opportunity comes knocking that keeps you cocooned in a comfort bubble. You are not your past. You are not your future. You are right now. That’s it. That’s all you ever get at once. And, you can begin creating a new self-story as soon as you decide you’re good and ready. If it’s â€Å"I’m an incredibly fun person to be around† and you believe†¦it shall be so. 2. Add Some Spontaneity It’s pretty funny when you think about it, trying to be spontaneous. Here’s the deal, every single day of your life (when you’re not cave dwelling in your room) you’re confronted with tons of choices. Some more spontaneous than others. Those are typically the ones your old personal narrative tries to keep you away from (because they change who you are). Decide to be more spontaneous from this point forward. Decide that you’re going to become an amateur yes-man/woman and start chasing down those spontaneous leads that life keeps giving you. Sometimes just one is all you need to begin down a completely new path. 3. Remind Yourself of Your Mortality Often This always helps. Remember, you’re going to die someday. Really drink that in. Not just in a passing scared kind of way but a completely open and honest acceptance. Your life is going to end. You will one day cease to be and nothing you do or don’t do can change that fact. Period. Well, unless you opt to become a robot or something. But anyways, the next time you feel like a boring person living a boring life, remind yourself that you have a few figurative moments left to take advantage of. 4. Make Your Goals More Fun Maybe your goals are boring? Maybe your vision of the future and what you’re working towards are drab, generic and uninteresting. Not to say they aren’t awesome and great and all that, but perhaps they could use some freshening up around the rough edges? It’s hard to be a fun person when you lead a boring day to day routine. Start adding in the fun to your goals: relationships, business, education, etc. 5. Chase Your Fears Smile Even though this is step 5, these are probably two of the easiest things to understand and do. First, you chase your fears. What are you afraid of? I mean honestly. Are you afraid of success and popularity? Are you afraid of being liked by people? Are you afraid of being well-known or exposed? Once you write out this bucket list of fears, begin to chase them down (within reason, no burying yourself alive or anything). You get the idea. If you’re afraid of heights, go sky diving. Now, the second part is subtle. SMILE! Because we have no idea how we are perceived by others (see step 1), and because we have no idea what we look like while we live our lives, we really don’t take too much notice of the look on our face throughout the day. I tell you this, if you smiled 30% more for the next week you would notice an improvement immediately. Never, ever, EVER, underestimate the power of smiling. We’re drawn to it. Our minds love it. We want to smile more, whether we know it or not. Chase those fears of yours with a smile on your face, sporting fun goals, a new personal elevator pitch and a new sense of spontaneity. Cool? We’d like to hear back from you on this. What do you think?

Wednesday, November 20, 2019

Safe and Quality Healthcare Services Essay Example | Topics and Well Written Essays - 1500 words

Safe and Quality Healthcare Services - Essay Example So as we see, FMEA is a precautionary process, which helps prevent problems and help deal with them in an effective and organized manner, if they were to occur. This analytical method has been used since several decades in the production and engineering industry and has proved to be an excellent tool in identifying and reducing hazards. It examines each individual component of a particular system to determine a number of ways in which each component could fail and, not only this, but the effect of a particular failure on the stability of the entire system. (Spath, 2003) One of the major concerns in the healthcare industry is safety. The assurance that a patient is in reliable hands and that the treatment being done or service being offered is safe up to quality standards. For patient safety and wellbeing, healthcare service providers must adopt a set of rules or standards to abide by. The Joint Commission on Accreditation of Healthcare Organizations (JCAHO) assumed responsibility for the certification of hospitals in 1951, back then, the standards continued to uphold a safe environment. Because of increasing public concern with the problem of medical errors and patient injuries, JCAHO reinforced its commitment to patient safety. Commencing in 1996, JCAHO introduced a number of new standards that are intended to maintain continuous improvement in the safety of the services provided to the public. (Spath, 2003) In addition to adopting well defined processes used in healthcare services and assuring that the personnel performing the processes are competent, there is a need for more safety and precautionary measures. The solution to this lies in other industries. This is when JCAHO executives considered standard changes to adopt a more a proactive approach to risk reduction, they researched many other techniques to improve safety used in other high-risk industries to find one that would be adaptable to health care services as well. (Spath, 2003) The process So, basically FMEA is a proactive approach and it consumes little time and resources when compared to the return on investments. The National Center for Patient Safety website developed by the Veterans Affair, devised a set of steps applying the traditional FMEA to healthcare. The process is as follows: 1. Choose a process to study. JCAHO requires the

Tuesday, November 19, 2019

What is political legitimacy Essay Example | Topics and Well Written Essays - 1250 words

What is political legitimacy - Essay Example John Locke’s view of political legitimacy emphasizes the necessity of respect for human rights and transfer of authority based on consent for effective public administration. Plato was philosopher and a mathematician during the Classical Greece. He was also an influential figure in the philosophy of the West. Plato, in The Republic, declared that an ideal society ought to be run by a council of philosopher-kings (Plato & Cornford 22). Plato recommended that philosophers needed to do a thorough learning of the world prior to making their way into leadership at the age of fifty. According to Plato, the best form of political legitimacy constitutes the moral reordering of the whole society. Plato, thus, implied that moral societies are dedicated to returning to the best ways of doing things in order to be the best version through which the society can be idealistic and achieve perfect governance. Locke proposes that after the establishment of a social contract, the first act of the government is creating different branches of the government. Lock suggested that the optimum number of government branches should be three as this could ensure maximum peace and protection (Rawls & Freeman 53). When people are assured of their protection, there are high chances of increased productivity because there is no fear of security threats. Peace in a country is the primary determinant of security and protection; therefore, the government should strive to use its machinery to ensure prevalence of peace and tranquility in the states. The Republic by Plato is actually an investigation at the harmonic justice that should be afforded to human beings and the balance required to establish the moral health of the soul. Plato believed that search for political legitimacy is not streamlined since it constitutes a journey within using the models of ideal state,

Saturday, November 16, 2019

Disclosure of material facts by proposer of insurance Essay Example for Free

Disclosure of material facts by proposer of insurance Essay A fact is considered to be material as per the provisions of Section 18(2) of the Marine Insurance Act 1906 if it would influence the judgment of a prudent insurer in fixing the premium, or determining whether he will take the risk. This rule applies is also applicable to non-marine insurance and despite the proposals of the Law Commission not being addressed to marine insurance, undoubtedly the decisions of the courts on disclosure of hull risks will have repercussions for householders. The degrees of influence are given below. The three degrees of influence. (A) Information type A is so material that the insurer, if he had known about it would have refused to enter the contract or in the alternative the insurer would have made further investigations resulting in refusal to do so. (B) Information type B consists of facts, which if the insurer had been aware of, would have resulted in the insurer’s making the contract of insurance but on quite different terms especially in respect of premium or conduction of a further investigations leading to insurance on a different set of terms altogether. The proposer has to reveal the material facts known to him whilst proposing insurance. However, in Berger Ltd. v. Pollock , non-disclosure of certain information, was held to be immaterial because the judge was far from satisfied that, if the undisclosed matters had been fully reported and explained to these underwriters, they would in fact have declined to accept this declaration under open cover or have sought to vary its terms or to require an increased rate of premium. (C) Information type C is that information, whose knowledge would have made the insurer consider it relevant but would not have resulted in the insurer’s refusal of the contract or insistence on different terms. It is information, which though affecting his judgment would have, in conjunction with other facts, had they been present, would have resulted in a different contract, but, which of its own accord, would not have affected the particular contract or its terms. This is the present position in England and is the consequence of the judgments of the Court of Appeal in CTI v. Oceanus . It has been suggested that this case propels English law in the direction suggested by the Law Commission. However, the Court of Appeal’s objective was to respect the Courts view of precedent. The reality is that the Court has succeeded in distancing the law from precedent, principle and the interests of the assured. This decision has met with almost universal concern and disappointment. CTI v. Oceanus CTI entered into an insurance contract successively with A, B and Oceanus. A and B being dissatisfied with the claims experience wanted a change in the terms of cover which were not acceptable to CTI . Hence, CTI insured with Oceanus on the basis of an account of their past claims record which, was not complete or entirely fair and accordingly Oceanus endeavoured to avoid the policy for misrepresentation and non-disclosure. Lloyd J. held that, even in the event of disclosure of all the relevant information the insurer would have made this contract on the same terms and that such information, which could be classified as belonging to type C, not being material, the contract could not be avoided. On appeal the Court held that the undisclosed information was to be classified as type B and not type C and therefore the decision at first instance had to be reversed resulting in the avoidance of the insurance. Nevertheless, the Court also stated obiter but after hearing argument, that there is no requirement that the particular insurer should have been induced to take the risk or charge a lower premium than he would otherwise have done as a result of the non-disclosure. The consequence of all this is that information of type C in English law is material and its concealment enables the insurer to avoid the contract of insurance, without any reservations in respect of commercial insurance and most likely in other lines too. It was hinted by Kerr L. J. that this rule might differ in respect of consumer insurance but the Law Commission has refused to countenance a special rule for consumers. Practicality. First, despite the absence of an absolute standard, the test of materiality is that of the prudent insurer, which is an objective test controlled and applied by the court on the basis of expert evidence. This is similar to that of a reasonable man in tort. In the parlance of insurance practice this test of a prudent insurer is no more a genuine inquiry into a particular person’s mind than it is in relation to the other reasonable or prudent persons who populate the rules of law to legitimise the dominant role of the judge. Secondly, despite the objective nature of the materiality test, it is not understandable as to why it is easier and therefore more pragmatic and definite to state that a fact has some influence or is of the type C, rather than to state that it has a decisive influence or that it can be classified as type A or type B. Thirdly, if the proposer has to perforce disclose information of the type C, then there is the further objection that probable assureds will be better off by exercising caution and not taking any risks by indulging in a total disclosure. The decision in CTI v. Oceanus does not take into cognizance the basic nature of misrepresentation and non-disclosure as connoting something that vitiates consent, in this case the consent of the insurer. It becomes to accept that the consent of the insurer was vitiated and that consequently the contract should be avoided, if the insurer would have made the same contract on the same terms, despite the lack of misrepresentation or disclosure.