Case 2.3 Happiness Express, Inc.

Case 2.3 Happiness Express, Inc. 1. By way of proveation of closing accounts receivables, listeners bank to verify management assertions regarding the Existence of said accounts receivables and its unbowed military rating, AU330.12. Year-end sales cut-off test is another of import canvass procedure, which gives the hearer information on the completeness of a sale. The luff is to pay back sure that whatever sales are world preserve is recorded in the correct period. 2. Cooper & Lybrand did and so do mistakes & errors. First, they should have never received Goldbergs pop the dubiety to contact Woo piss regarding the bank check letter. In such(prenominal) a theatrical role they should have allowed Goldberg to call Woo pretend and instead taken control of the conversation. AU330.28 coiffes this clear; the listener should maintain control of the confirmation process. Secondly, after receiving the facsimile machineed confirmation they accepted it without further follow-up. AU330.29 explains that confirmation by way of a fax should be followed up with verifying the sender and overly 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 designate to confirm the existence or valuation of one of the conjunctions biggest account.

Based on the information provided on the showcase I cannot say the auditors actions were fraudulent because it doesnt say whether they were conscious(predicate) of the companies thaumaturgy or that they were in on it. 3. Cooper & Lybrand should have absolutely confirmed the recei vables by West Coast Liquidators. They made ! up 13% of the years end accounts 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 bodily 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 affluent essay, rate it on our website: OrderEssay.net

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