Referring to Delmoss Watergrant's policy for identifying significant accounts as well as Sarbox Scooter's consolidated balance sheet
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(a) Determine a planning materiality threshold to use to identify significant accounts for Sarbox Scooter. Please show your work and justify judgments.
(b) At a consolidated financial statement level, are there accounts on Sarbox Scooter's financial statements that are greater than planning materiality that should not be considered significant? Please justify your response.
(c) Identify two accounts, at the consolidated level, that are not quantitatively significant, but that should be deemed significant due to qualitative factors. Provide the qualitative factors you considered.
(d) Which Sarbox Scooter business units (geographic locations), if any, would not be considered quantitatively significant? Which business units (locations) have specific risks that would render the unit significant regardless of its quantitative size?
(e) If you had to eliminate or scope out one entire business unit (geographic location), which unit would it be? Please justify your response and include both quantitative and qualitative reasons for doing so. Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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Related Book For
Auditing Cases An Interactive Learning Approach
ISBN: 978-0133852103
6th edition
Authors: Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt
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