Exam 15: Assets, Liabilities and Equity Related to the Financing Cycle

Why is it more important for an auditor to perform a search for unrecorded notes payable than for unrecorded notes receivable? Discuss some audit procedures the auditor may use to uncover any unrecorded notes payable.

The auditor is reviewing the current tax liability for a client in an industry where tax rates are anticipated to decrease because of near-certain Congressional action. In this case the auditor should:

Typical debt disclosures include future cash payments for each of the five years following the latest balance sheet date.

Analytical procedures for testing investments would include:

The SEC requires that stock that has mandatory redemption requirements or has redemption considerations that are out of the issuer's control be shown outside of the stockholders' equity section. .

FASB ASC 505-10-50 requires:

Discuss an auditor's objectives in the audit of long-term liabilities. Describe appropriate analytical procedures an auditor may apply to long-term liabilities.

Explain the audit steps for detecting the following issues. (a) Unrecorded noted payable (b) Unrecorded dividends payable (c) Unrecorded NSF checks (d) Unrecorded pension liabilities (e) Unrecorded stock buybacks (treasury stock) (f) Unrecorded stock compensation expense (g) Unrecorded covenant violations (h) Unrecorded debt issuance

Post-retirement benefits are generally:

Jillian is on the Big City Defense Company's audit with Andrew (described in 15-31) but has been assigned the task of performing tests of details of balances for the investment account. She has never audited investments before and asks Andrew for some advice.Andrew tells her that she needs to review which management assertions are relevant for the investment account. Then she needs to understand appropriate tests that will provide evidence on these assertions. Required: (a)What are management's key assertions for the investment accounts? (b)How can Jillian utilize inspection in the tests of details of balances for investments? How can she utilize confirmations? What evidence will these audit procedures provide for the financial statement audit?

FASB codification section 712 addresses pension obligations.

Valuation techniques:

Disclosures relating to debt include:

Which of the following would be found on an interbank transfer schedule?

Derivatives can be recorded as either an asset or liability.

A registrar:

A deferred tax liability is recognized for:

Kiting:

Debt securities:

Pensions: