Laramie Wire Manufacturing is a company that specializes in the production of wire and wire-related products. The company has a long history dating back to the early 20th century, and it has a reputation for producing high-quality wire products that are used in a variety of applications.
One of the key factors that has contributed to Laramie Wire Manufacturing's success is its commitment to innovation. The company has always been at the forefront of developing new technologies and processes for producing wire, and it has invested heavily in research and development in order to stay ahead of the competition. This commitment to innovation has allowed Laramie Wire Manufacturing to introduce a number of new products over the years, including wire for electrical and electronic applications, wire for the automotive industry, and wire for the construction industry.
In addition to its commitment to innovation, Laramie Wire Manufacturing is also known for its strong focus on quality. The company has implemented a number of quality control measures to ensure that its products meet the highest standards of performance and reliability. This focus on quality has helped Laramie Wire Manufacturing build a loyal customer base over the years, as customers know they can count on the company to deliver products that meet their needs and exceed their expectations.
Another factor that has contributed to Laramie Wire Manufacturing's success is its commitment to sustainability. The company has implemented a number of initiatives to reduce its environmental impact, including recycling programs, energy-efficient manufacturing processes, and the use of renewable energy sources. This commitment to sustainability has helped the company reduce its carbon footprint and minimize its impact on the environment.
In conclusion, Laramie Wire Manufacturing is a company that has a long history of producing high-quality wire and wire-related products. Its commitment to innovation, quality, and sustainability has helped it build a strong reputation in the industry and establish itself as a leader in the field.
Company tends to overstate their revenue. Ensure that Laramie uses the same valuation method during its recording phase. The fifth management assertion Laramie must look over is its rights and obligations. Therefore, this increase shows either that Laramie has trouble keeping inventory accounts down or net sales are slowing relevant to the amount being produced. The production area is divided into three areas, with each area specializing in a particular product group, including residential products, industrial products, and special-order products. The different types of products Laramie manufactures all use similar raw materials, so raw materials inventory is stored in a single location, divided only into copper and plastics. Prerequisites Computer Resources: Course Objectives: This course is designed to provide you with an understanding of professional auditing as practiced in the United States.
However, the calculation pertaining to plastics inventory reveals that the market value should be used for classification, but Laramie has used cost. An executive asked him if he still lived on trees. This area needs to be checked by the auditor. Risk may rise when Laramie sells a spool of insulated copper wire to a customer, because an issue of who pays the transportation costs arises pertaining to the free on board point. Every level of audit risk has an opposite connection that exists between assessed levels of controls, inherent risk, and level of detection risk… Reporting Practices and Ethics Paper Throughout this paper a summary of the four elements of financial management will be discussed. Get your paper price 124 experts online Laramie is a first time client of the firm, and has hired the firm to perform a financial statement audit to prepare for the initial public offering.
1 Laramie Wire Manufacturing: Using Analytical Procedures in Audit Planning
This inventory should be valued at 120,000 in accordance with US. The audit team will also examine and measure the operational performance by studying specific parts of the organization and evaluate the effectiveness and efficiency of operation activities on the financial statements. Examples from specific articles that reflect ethical standards of conduct and financial reporting practices along with the significance of each example will be identified and discussed in detail. You are in the planning stages of the audit, and you are preparing to conduct some analytical procedures to identify areas that may represent heightened risk and that thus may require further attention. Simple analytical procedures comparisons, ratio analysis, trend analysis, and common size financial statements are effective as attention directing tools in the planning and final review stages of the audit.
ACC 492 Week 4 Laramie Wire Manufacturing Case Study...
There may be customers who are not paying due to defective products they purchased. In this case, average machine setup time from start to finish is approximately six hours, which is slightly below the industry average. Focus specifically on each of the five management assertions existence or occurrence, completeness, valuation or allocation, rights and obligations, and presentation and disclosure for the inventory account. Link any risks you identified for this account in question 1 to the related management assertion. Laramie operates out of a single building complex totaling 500,000 square feet, which includes office space 3% , production area 57% , shipping and receiving 15% , and finished goods and raw materials inventory warehousing 25%. Operational Auditing Laramie Wire Mfg. In connection with our audit of the financial statements, we will obtain an understanding of internal control sufficient to plan the audit and to determine the nature, timing and extent of audit procedures to be… Acc 280 Financial Statements Paper The purpose of this paper is to define accounting, and identify the four basic financial statements.
Therefore, having a large production layout and different raw materials to account for Laramie could miscount the amount of raw materials on hand. About twenty years ago, my dad was surprised when asked the question during a business seminar in Boston. Submitted By reasearch Words 354 Pages 2 Stereotype about Africa, I came in the US ten years ago for my studies. Third, the Audit Engagement Supervision requirements have also been placed on the auditor that ensures the supervision of the audit work assigned to engagement teams. Nor do they all walk around in the nude among lions and zebras. .
Financial Audit and Laramie Wire Manufacturing Essay
Companies usually updates their standard costs every year. Laramie buys copper rod and plastic materials to produce insulated copper wiring. Therefore, more testing is needed to see if the copper wire inventory was potentially overstated in the amount of pounds in 2008. This is the first year your firm has conducted the audit for this particular client. Valuation or allocation, make sure proper write-offs are accounted for and properly recorded in the balance sheet. You are not permitted to use solutions manuals, solutions from prior semester materials.
Each pallet measures 5 feet by 5 feet, stands 5 feet tall, and holds 1,250 pounds of copper rod. Test controls that all incoming receivables have been processed and are complete. The financial audits will make sure that financial statements are presented according to General Accepted Accounting Principles GAAP. A cursory visual examination of inventories reveals no problems. As we use the management assertions to account for inventory there are a lot of scenarios that must be addressed.
Procedures and records for tracking materials upon arrival, through the production process, and into finished goods and shipping, appear to be well designed. The amount of square footage the copper wire pallets take up is more than the amount of square footage Laramie has designated for finished goods and raw materials. A summary of generally acceptable accounting principles and general financial ethical standards will also be addressed. Also, the auditors should compare client data with prior period. Because it is known how much inventory is stored on the spools, how much room they take up,. Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts, tests of physical existence of inventories, and direct confirmation of certain assets and liabilities by correspondence with selected customers, creditors, and financial institutions. Laramie being a manufacturing company may have problems with the management assertion of completeness even though the analytical procedures did not point to any problems.
Overhead consists primarily of the costs of the production facilities and depreciation and maintenance on the machinery. Words: 1147 Case Study Assignment Prepare written answers to the following case from Auditing Cases: An Interactive Learning Approach, 3rd edition , by Beasley, Buckless, Glover, and Prawitt: Case 8. Briefly explain identified risks or issues for the inventory account that require further attention, if any. One analytical procedure that does not use financial data is the amount of square footage Laramie has designated for finished goods and raw inventory in its building complex. In fact, although Laramie has previously engaged accountants to perform limited review services for the purpose of obtaining bank loans, this is the first year Laramie has contracted for a full-scale audit of its financial statements.