ACC 821 Lecture Notes - Lecture 5: Audit Risk, Revenue Recognition, Internal Control
20 Nov 2014
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Document Summary
Mgmt. intervention to specify the acc treatment. Manual intervention for data collection and processing. Revenue recognition: income on long term contracts, revenue received in advance, revenues deferred, cuf off of revenue, items recorded as rev that may not be rev ie deposits. Large amts produced from poor internal control system. Distinguishing factor: whether misstatement of the fs is intentional or unintentional, may hoewever be diff to determine in practice if intentional. Fraud an intentional act by one or more individuals among involving the use of deception to obtain an unjust or illegal advantage by: mgmt, those charged with ogvernance, em0loyees, thirs parties para 11. Fraud risk factors: events or conditions that indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Two types of fraud relevant for the auditor: fraudulent financial reporting, misappropriation of assets.
