Audit Assurance and Compliance of luxury travel holiday Free Samples

A self-interest threat and advocacy threat may arise when the auditor is been asked to promote the organization and auditor put it’s personal, financial and self-interest in decision making. All this unethical behavior will influence the professional judgment and overall affect the auditor independence. As per the given situation, LTH providing self-interest and advocacy threat to CJI of reappointment only after promoting LTH business in next travel agency seminar (ACCA, RELEVANT TO ACCA QUALIFICATION PAPER P7 , 2012). To show sincerity towards audit firm and create long relationship in anticipation of smooth audit, Gifts and hospitality were offered by the client to a member of the audit team which gave rise to self-interest threat. There is a issue in particular circumstance because the offer of gifts influences the auditor judgment in favor of the client that might create an unethical and a bias audit observation and affect the overall auditor independence. As per the given situation of LTD, threat exists for CJI firm as its members judgment is influenced by accepting a free offer of free 14 days holiday package voucher to the Greek isles for both Geoff’s and his family (ACCA, RELEVANT TO ACCA QUALIFICATION PAPER P7 , 2012). This circumstance occurs when in case there is a situation where the person related with the audit assignment or the partner of the audit firm has a personal relationship with any key personal of the company in which the auditor is working out audit assignments. This will create certain threats related to self interest factors of the auditor. As in the particular case audit team member might be more sympathetic towards the client and make a decision in accordance with the benefit close family member personal interest. As per the given situation there might be a biased auditor judgment because Michael is having close family relationship with LTH financial controller. When any non-audit service such as tax calculation and accounting entries performed by any auditor or by any person from the audit team influence the audit professional judgment and overall affect the audit independence as per the given situation Annette being the member of audit team helping the client in tax calculation and accounting entries affects the auditor judgment. Reviewing the self inputted transaction will affect the auditor’s independence as he will not try to observe errors and frauds in the work done by him or any other member of the audit team (Kaplan, 2012). Safeguard are the various measure available to CJI being get protected. They shall be the applied against the threat faced by professional to eliminate them in an acceptable manner. CJI has identified various safeguard of each threat in given situation Note - If the above safeguard cannot be reduced the auditor should withdraw from the engagement Business risks are certain hazards on happening of which might enhance the vulnerability of the enterprise. The business risk in MSL are the factors that could prevent and hinder the organizational goal and objective the ultimate business risk among the various risk faced by the organization is the risk that seizes to be a going concern. Therefore company faces various risks factors that might contribute towards business failure examples of business risk include- In the particular case study the current organsiation has its business of manufacturing and selling the equipment and spare parts which are handful in doing the mining jobs. MSL has operational centers in Perth, Newcastle, and Mt. Isa.   Warehouses the equipment and spare parts and provide for sales and maintenance services. An auditor with Crampton and Hasaad has found various audit risk while auditing the financial statement of MSL (ACCA, ANSWERING AUDIT RISK QUESTIONS, 2015). There is a great probability that the auditor associated with the business enterprise might lack in the decision making and states an inappropriate opinion towards the enterprise financial statements. Auditor will access inherent risk, control risk and accordingly find the level of audit risk materiality enables the auditor to apply procedure which can support his opinion that is higher the materiality level, higher will be materiality level, higher the need of audit evidence and lower will be the audit risk thus there is inverse relationship between audit materiality and audit risk. Also, there exists inverse relationship among risk of material misstatement and detection risk as higher the level of risk of misstatement lower will be the detection risk and vice versa. When there is lack of internal control environment in the current business establishment it will give rise to the associated inherent risk. When auditor is required to enhance its judgment skills to give an appropriate decision there can be a instance that auditor might misses out to ascertain material facts, this will give rise to the inherent risk (simplified, 2013). Control risk arises when related internal control in MSL exists but ineffective or in other words, we can say that when absence or failure in the operation of the relevant control of the entity results in amaterial misstatement in the financial statement. Assessment of control risk is higher if financial statement is prepared by individual who don’t have necessary technical knowledge of accounting and finance (simplified, 2013). Situation of detection risk arise when in situation there are certain material miss-statements and auditor fails to disclose in its opinion report due to lack of determination and skills in identifying it. The auditor may apply proper policies and procedure to detect a material misstatement in financial statement arising due to omission, fraud, and error. Detection risk can be reduced or controlled by auditor if it increase the number of sample transaction for detailed (simplified, 2013). ACCA. (2015).Answering Audit Risk Questions Retrieved April 20, 2017, from https://www.accaglobal.com/in/en/student/exam-support-resources/fundamentals-exams-study-resources/f8/technical-articles/audit-risk0.html ACCA. (2012). Relevant To Acca Qualification Paper P7 . Retrieved April 20, 2017, from https://www.accaglobal.com/content/dam/acca/global/PDF-students/2012s/sa_nov12_p7_ethics.pdf IRELAND, C. (2014). Provision Of Accounting Services To An Audit Client.Example Of Threats And Safeguards. Retrieved April 20, 2017, from Certified Public Accountants: https://www.cpaireland.ie/members/technical-resource/ethics/ethical-standards-for-auditors/accounting-services-examples-of-threats-and-safeguards Kaplan. (2012). The Code of Ethics for Professional Accountants. Retrieved April 20, 2017, from https://kfknowledgebank.kaplan.co.uk/KFKB/Wiki%20Pages/The%20Code%20of%20Ethics%20for%20Professional%20Accountants.aspx simplified, A. (2013). Audit Risk Model, Inherent Risk, Control Risk & Detection Risk. Retrieved April 20, 2017, from https://accounting-simplified.com/audit/risk-assessment/audit-risk.html Getting academic assistance from

Finance Assignment Essay Example | Topics and Well Written Essays - 1500 words - 1

Finance Assignment - Essay Example However, the best practise to calculate the cost of capital is to consider the market value of the assets, in which case, the difference can be significant. The WACC is calculated using only the cost of debt and the cost of equity. It is important to note that raising capital via. Debt increases the beta value of the company, i.e., the risk of investing is increased, as the company is obligated to pay the debt. Hence the cost of equity is also increased due to this change in capital structure. The debt ratio of Boral limited is computed as the ratio of total debt to total assets which is equal to (1518/5816.60) 26.1%. This is lesser when compared to the Commonwealth bank which has a higher debt ratio. Also, the Commonwealth bank of Australia has lesser short term money and in order to compute the liquidity position of the bank, the cash as well as the loans and deposits are to be considered. The gearing ratio of the bank has to be much higher, as the entire operation of the bank involves taking deposits and lending loans. However the gearing ratio of Boral cannot go much higher as it will affect the debt rating of the company. From the balance sheets, it is evident that Boral Limited has a number of non-tangible assets whereas all the assets and liabilities are monetary in nature. The banks normally seek and increase liabilities in order to build the assets. However manufacturing companies tend to build assets and thrive to increase the value. As there are opportunities for business development with the additional capital raised by making the company public, it is essential to estimate the business growth. This will give an estimate on the earnings per share. Based on the earnings, the plowback rate can be computed for continuous growth. Hence from the earnings per share and the plowback rate, the dividend payments can be forecast during the growth period. Case 1: Assuming that the business can expand for the next 6 years and

The Judgment of leaders Assignment Example | Topics and Well Written Essays - 2500 words

The Judgment of leaders - Assignment Example Both the internal and external societal contexts also plays a major role where organizations notably the corporate world and civil leadership are increasingly fragmented, and acknowledging equivocal and this has resulted into modification and change in various conventional concepts in regard to followership and leadership. The key specific conventional factors include the rise of organizational crisis, ethical issues, social issues, motivation effects and corporate scandals. These factors have created uneasiness, leadership desired and inadequacies and emphasis on the search of meaning. Therefore the practical challenges underlying leadership as a business and social practice has elicited various perspective of judgment from the followers. These conventional perspectives are notably centered on the followers thus taking person-centered thus the underlying judgment rely on stereotyping and heroic leadership. Thus the judgmental influence of the followers is unidirectional flowing from the leaders to their followers representing specific perspective which reconstructs the hierarchical subject-object relations. The leader follower relationship represents widely the interactions and mechanisms between the independent individuals. Followership and its judgmental on the leadership are important because the latter cannot exist without the other. Therefore it is important to determine the leader-centric focus and how the followers judge and understanding interdependence of leadership and its active fellowship. The bottom line on how followers judge leaders is how leadership is shared and the leader’s judgment on his or her followers. Leader-Follower centrality Relational qualities uniting leadership-followership notably have significant influence on Followership judgment on their leaders. This begins with the leadership perception to his or her relative followers and to himself. This forms the foundation in which the followers judge the leaders because the self other perception influences greatly the followers perception. Notably in regard to this are the follower’s judgments that favor leaders’ power and authority over them. This is common where the followers exhibit dominant motif and in this case the followers look compliant and can be easily manipulated even at the extreme ends (Oddenino, 2003). In organizations and corporate world subordinates within dominance motif feel abused but they cannot do anything. The managers and CEOs say that leadership is when pain inflicted is demonstrated for effectiveness to be achieved. The subordinates within dominance motif judge their supervisors and managers with the assumption of mutual dependency idea in their organizations as well as the value of maintaining personal dignity (Weibler, 2011). The subordinates are cowed in their judgments therefore leaders are likely to get deprived of accurate and honesty information. This fuels self-absorption and self-deception resulting in the fa ll of arbitrary power. GROUPTHINK According to Ladkin (2010) in his study on organizational leadership provides that Groupthink is adopted by most followers in judging their leaders. This is where there agreement and consensus is far much important than the solution, in this case followers adopt possible alternative courses of action in their judgments (Ladkin, 2010). This is common in organizations and