Management has explained the decline in cost of goods sold as involving: Lower purchase accounting charges, primarily
Question:
Management has explained the decline in cost of goods sold as involving:
Lower purchase accounting charges, primarily reflecting fair value adjustments relating to acquired inventory that was subsequently sold
Lower costs related to new cost reduction and productivity initiatives, as well as savings generated from ongoing productivity initiatives to streamline the supply chain network
Reduced manufacturing volumes related to products that lost exclusivity in various markets
The impact of favorable foreign exchange rates of 3%.
Explain the types of ratio analysis that you could conduct in substantive analytical procedures to test the validity of management’s explanations.
Auditing A Risk Based Approach to Conducting a Quality Audit
ISBN: 978-1305080577
10th edition
Authors: Karla Johnstone, Audrey Gramling, Larry E. Rittenberg