Thomas, J. Assignment 3-3

vi.3

Distinguish between financial accounting and managerial accounting as to user groups and time horizons. Why should the chief accountant of an organization have a clear understanding of both financial and managerial accounting? How did the internal control procedure of separation of duties fail to detect the fraudulent behavior in problem 1-28b on page 51? Consider the elements of the fraud triangle and explain how each element is present in this problem.

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Question 37 options: What is the name of the language for electronic communication of business data that allows companies to report financial informaitn in a sturctured, machine-readable format?

Chapter 15 Discussion, 1. Research for entry In section 4 of this chapter we looked at “Why Accounting Information is so Important". One of the topics in that section was “Accounting Fraud". Famous Accounting Scandals The following firms have been convicted or accused of accounting fraud: Enron, Lehman Brothers, Fannie Mae & Freddie Mac, and AIG, to name just a few. Using an internet search engine, find information on a recent accounting scandal. • Title of your entry should include the name of the company, and the date or timeframe of the scandal, the more recent the better. Consider some of the following to guide your entry: • Summarize what this firm does, and how/why they got into trouble. • what type of questionable accounting practice occurred in this firm • what were the consequences for this firm and the executives involved in the scandal • how were the public/investors/economy affected by this firms dishonesty • Document cited works and all references, links are ассеptable.

Question 3 Which of the following IT events would create the most serious risk to financial reporting?   A. Employees writing down passwords on sticky notes   B. Using software on the company network that has been downloaded from a warez website   C. Finding an employee running a personal business on company computers   D. Unauthorized access to the corporate network

Chapter 8:  Sarbanes Oxley, Internal Control, and Cash Chapter 8 discusses the creation of the Sarbanes Oxley Act of 2002.  The act is commonly known by the acronym "SOX."  The act established the Public Companies Accounting Oversight Board.  This board is sometimes known as the "Peek-a-Boo" which serves as what may be a very appropriate acronym.  Please let us know why the Public Companies Accounting Oversight Board has come to be known as the "Peek-a-Boo."  Please use the link below to access the Sarbanes Oxley Act of 2002 and include it. http://www.soxlaw.com/ (Links to an external site.)

Chapters 3.2 to 3.5 discuss four data analytics approaches                                                                (A. DescriptiveB. DiagnosticC. PredictiveD. Prescriptive                                                                                                                                           That may be used to address our accounting questions. Describe how each of the four data analytics approaches could be used by credit card companies to identify fraudulent credit card activity. You need to identify your potential questions and the corresponding analysis methods or tests to address your questions.

What is the relationship between Accounting and an Accountinginformation system?  • What has happened to the relationship over the years? • What is accounting information?  • Name 4 uses of Accounting Information?  • Use an example to illustrate the difference between data,information, and intelligence?  • Discuss security concerns related to shadow data and businessintelligence technologies.  • Discuss the role of accounting professionals in thedevelopment of shadow data.  System Documentation • What is system documentation?  • Why is it important to know system documentation?  • Explain the 4 elements that makes up the Data Flow Diagrams?  • Give an example of who or when one of these documents may berequired  • What are Flowcharts?  • List an example of an Input/output, processing and storage Symbols  • Differentiate between different types of Flowchart? • If you were a new factory employee on your first day at a vastfactory, indicate which level Flowcharts would be required and •…

Question 9 To what does the following relate: As the business has grown and the number of transactions per day has multiplied, the financial accountant is very busy and constantly making errors   1. Control activities – Independent checks and reconciliations   2. Inherent limitations – cost vs benefit   3. Inherent limitations – human error, time constraints   4. Monitoring of controls Question 10 To what does the following relate: Entry to and exit from the warehouse are monitored 24 hours a day by surveillance cameras   1. Control environment   2. Monitoring of controls   3. Validity of transactions   4. Control activities – Access controls Question 11 To what does the following relate: Regular stock counts are performed, and the actual count compared to the inventory on the system   1. Control activities – documentation and records   2. Validity of transactions   3. Control activities – independent…

Question #66:  Lamar LLC is in the process of updating its revenues and receivables systems with the implementation of new accounting software. James Loden, Inc. is an independent information technology consultant who is assisting Tamar with the project. James has developed the following checklist containing internal control points that the company should consider in this new implementation: Will all data entry clerks and accounting personnel have their own PCs with log‐in IDs and password protection? Will different system access levels for different users be incorporated? Will customer orders be received via the Internet? Has the company identified an off‐site alternative computer processing location? Does the project budget include line items for an upgraded, uninterrupted power source and firewall? Required: In a two (2) page response, describe the control purpose for each point presented in the case.

ESB. ACCOUNTING CONNECTION Careful scrutiny of accounting records and financial statements can lead to the discovery of fraud or embezzlement. Each of the situations that follow may indicate a breakdown in internal control. Indicate the nature of the pos- sible fraud or embezzlement in each of these situations. 1. Wages expense for a branch office was 30 percent higher in 2014 than in 2013, even though the office was authorized to employ only the same four employees and raises were only 5 percent in 2014. 2. Sales returns and allowances increased from 5 percent to 20 percent of sales in the first two months of 2014, after record sales in 2013 resulted in large bonuses for the sales staff. 3. Gross margin decreased from 40 percent of net sales in 2013 to 20 percent in 2014, even though there was no change in pricing. Ending inventory was 50 percent less at the end of 2014 than it was at the beginning of the year. There is no immediate explanation for the decrease in inventory. 4. A…

QUESTION 25 One of the reasons that businesses use accounting is it: O a. supplies information that permits informed judgements and decisions Ob.s casy to understand product information Ocs required by the government d. is a simple way to track company performance

Discussion Questions on Fraud Prevention from Chapter 4 Fraud Examination 4th Edition 1. How do organizations create a culture of honesty, openness, and assistance? 2. What are different ways in which companies can eliminate opportunities for fraud? 3. What is the purpose of adopting a code of ethics throughout a company?

ning Objective 1 E8-12 Understanding the Sarbanes-Oxley Act and identifying internal control strengths and weaknesses The following situations suggest a strength or a weakness in internal control. a. Top managers delegate all internal control procedures to the accounting department. b. Accounting department staff (or the bookkeeper) orders merchandise and approves invoices for payment. c. Cash received over the counter is controlled by the sales clerk, who rings up the sale and places the cash in the register. The sales clerk matches the total recorded by the register to each day's cash sales. d. The employee who signs checks need not examine the payment packet because he is confident the amounts are correct. Requirements 1. Define internal control. 2. The system of internal control must be tested by external auditors. What law or rule requires this testing? 3. Identify each item in the list above as either a strength or a weakness in internal control, and give your reason for each…

How can fraud be prevented in the making use of accounting information systems? How do ethics and internal control play key roles in reporting misstated financial statements? (Accounting Information System Tenth Edition by James Hall chapter 3)