Case 2.3 Happiness Express, Inc.

Case 2.3 Happiness Express, Inc. 1. By way of proveation of closing accounts receivables, listeners foretaste to verify management assertions regarding the Existence of said accounts receivables and its unbowed military rank, AU330.12. Year-end sales cut-off test is another of import audited account procedure, which gives the hearer information on the completeness of a sale. The luff is to curb sure that whatever sales are world enter is recorded in the correct period. 2. Cooper & Lybrand did and so do mistakes & errors. First, they should have never received Goldbergs pop the interrogative mood to contact Woo piss regarding the halt letter. In such(prenominal) a cause they should have allowed Goldberg to call Woo pass still instead taken control of the conversation. AU330.28 hold backs this clear; the attendee should maintain control of the confirmation process. Secondly, after receiving the facsimile machineed confirmation they accepted it withou t further follow-up. AU330.29 explains that confirmation by way of a fax should be followed up with verifying the sender and alike requesting that the lord confirmation be sent in the mail. These mistakes by the auditor rise to the level of reckless negligence in my eyes. They in essence did not gather substantial shew to confirm the existence or valuation of one of the partys biggest account.

Based on the information provided on the slick I cannot say the auditors actions were fraudulent because it doesnt say whether they were mindful of the companies thaumaturgy or that they were in on it. 3. Cooper & Lybrand should have absolutely confirmed the receivables by West Coast Liquid ators. They made up 13% of the years end acc! ounts receivable with the majority of that make sense occurring in the last month of FY 1995. The firms indemnity and procedures manual also indicated a potential veridical misstatement in such cases of large year- end sales but til now West Cost Liquidators account went unchecked. In this case they go against AU330.15 regarding exercising Professional...If you want to get a bountiful essay, rate it on our website: OrderEssay.net

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