Auditor Crazy Eddie

Auditor Crazy Eddie Question: What specific mistakes (apart from failure to notice â€Å"red flags†) did the auditor make? For each mistake, describe what the auditor should have done. If you were the Managing Partner for the CPA firm and had full knowledge of all the facts and events in this case, what changes in policy or procedures would you implement to make sure this audit failure does not occur in the future? The Crazy Eddies financial statements had many fraudulent over and understatements done in many ways that the auditors should have caught. They created fictitious revenues by a number of means. They prepared phony invoices showing sales which overstated their revenues to show the company was growing faster than they actually were. Their vendors collaborated in the fraud by lying to the auditors when the auditors attempted to confirm some of these receivables. The auditors were not diligent when they verified these invoices. They should have probed further into the vendors to verify that these sales occurred. They also should have understood the relationship between Cray Eddies and their vendors to understand if there were motives for fraud. They overstated their assets by overvaluing inventory. They would borrow merchandise from suppliers to inflate the ending inventory. The suppliers would ship the merchandise to the Crazy Eddies stores and hold the billing until after the end of the accounting period. The employees of Crazy Eddie went to great extents to deceive the auditors. They would move inventory to the stores or warehouses that were being audited to conceal the shortages. The auditors should have caught that the merchandise was not billed and understood what accounts they charged in the books when the merchandise was received. Another means of overstating the inventory was they shipped inventory from one store to another store so it could be double counted. This should have been caught by the auditors by having the entire inventory verified in parallel. The employees included in their inventory consigned merchandise and goods being returned to suppliers. This could have been found by understanding the details of Crazy Eddies inventory. The auditor should have identified the consigned merchandise and goods being return to separate it from the normal inventory. Crazy Eddie used the accounting periods to overstate assets and income. They held off closing the books past the end of the accounting period to overstated assets and income by boosting sales. The other means used was to reduce liabilities and expenses by not recording them until the next period. The auditors should have verified books at the end of the accounting periods to make sure that all transactions were recorded. The auditors needed to verify the transactions around the end of the period to verify their timing accuracy. Another category of fraudulent activities was when they were completing their financial statements. They didnt adequately disclose facts in the financial statements according to GAAP. The footnote during one period stated that certain income was recognized when received and the following period disclosed that income was recognized when earned. The auditors should have added an explanatory paragraph or a modification of wording for lack of consistent application of GAAP. Main Hurdman was the auditor for the companys annual audits and its consulting division was charging Crazy Eddie millions of dollars to computerize Crazy Eddies inventory system. This violates rule 102 for integrity and objectivity. Auditors cant objectively audit an inventory system they developed which means this is a conflict of interest. They should have chosen to develop the inventory system or be the auditor but not both. Crazy Eddies employees later stopped using the computer based inventory system designed by Main Hurdman and used their manual inventory system. The auditors should have noticed the change in the inventory system being used and understood why they changed. This should have been a signal that they were removing some of the quality controls in the inventory system. Many of Crazy Eddies accountants were former members of Main Hurdman accounting firm. The SEC added a requirement in the Sarbanes-Oxley Act that requires a member of the audit team not work at the client for one-year in certain key management positions. The firm is not independent with respect to the audit client if a former auditor accepts employment with the client. There were several reported instances where the auditor requested the client documents and were told that those documents were lost or inadvertently destroyed. Sarbanes-Oxley Act states that all working papers must be retained for 7 years. The inadvertent destruction of working papers that are less than 5 years has a penalty of 10 years in prison. The collusion of key personnel at Cray Eddies made it very difficult for auditors to uncover the fraud. If the auditors would have done a risk assessment prior to engaging with the client they would have identified a risk with so many family members employed at the company. The success and growth rate of Crazy Eddie was not normal. The auditors should have completed a comparative analysis of other electronic retailers. This would have shown that their high growth rate wasnt typical compared to others. This would have prompted the auditor to look closer at why they were outperforming the competitors. To prevent the CPA firm from having this occur in the future, they should follow the elements of quality control. The one element is the policies and procedures before accepting or continuing a new client relationship. They should complete a client evaluation form which includes evaluation of the clients management. If this was done in the Crazy Eddies case, they would have found that it was a risky client based on his selling techniques alone. The firm should follow the element of personnel management where all new personnel should be qualified to perform their work competently. The personnel should have adequate training and proficient. The field auditors for Crazy Eddies were young and inexperienced. The management team was able to manipulate and influence the auditors. The auditor needs to follow the procedure of verifying the inventory count by observing it. Precautions must be taken to avoid allowing the inventory to be moved by verifying it in parallel if multiple locations exist. Crazy Eddies auditors were fooled by not taking precautions to avoid double counting the inventory. The firm must follow the Generally Accepted Auditing Standards. One of the standards of field work is to obtain a sufficient understanding of the entity and its environment including its internal control. If this was done, the auditors could have seen that Crazy Eddie had influence over his suppliers to cooperate in inflating the assets. The change in the inventory system back to the manual system showed a lack of internal control. The firm must follow the rules of conduct. They must keep their objectivity by not providing other services such developing or advising an inventory system. They must remain independent by not auditing a client that has former members of the audit team working at the client within one-year.

Burton Snowboards Essay

In what ways does Burton Snowboards create utility for its different types of customers? Burton create utility for people who would like to enjoy a different type of activity in the snowing environment: †¢ Form utility: Burton took the idea of building the snowboard from snurfer which use to be received as a toy modify its concept to create a snowboard that can be perceived as a winter sport activity. †¢ Time utility: Burton’s snowboards products are available for people who enjoy snowboarding during the winter and snowing season which are suitable for snowboarding in ski mountains. Place utility: Burton made alliance with ski resorts to provide he snowboarding activity in ski mountains when the customers want to try different kind of winter sport. †¢ Ownership utility: Burton snowboard sells snowboard for the customers who like snowboarding activity around the world through a network of 3000 dealers sells the product. How can event marketing help Burton expand the customer base for its products? Burton conducts event marketing to allow people to try out the products for free; this will give the people to have an actual experience of the product and the activity that stays in the people’s memory, also the old customers can be invited and can give testimonies for the people about the product this is a good way to deliver the message about the product and increase the awareness as well. Burton runs about 400 demos around the word, these demos can maximize the audience involvement and interaction, so people remember and recall the product later at the time of buying. Suggest additional ways Burton snowboards marketers can use the Internet to more effectively build relationships and market their products? Burton snowboard can use the email newsletters to communicate with the existent customer and interested customers as well. It helps to provide an update about the company’s events and new products introduced. Customers will be kept updated about the company occasionally about the latest news, announcements or promotions. Blog is a great tool to provide two ways communications with the customers and people that share similar interests; Burton can recruit bloggers to write blogs about the events and products or any articles about the industry, and let the people response to them and share their ideas and inquiries. Burtons can join famous social network such as Facebook and twitter and allow many fans to join them this will enable burtons to update their fans about the event, offers, products, services and discuss related matters between fans. Relationship marketing is key to Burton’s success. Suggest two or three steps that the firm should be consider taking during the next five years to further enhance its relationships with the consumers and ski resorts? Burtons should take advantage of the best technology to easily keep track of business partners and customers preferences; this will help to identify key sales processes and provide ideas about the marketing plans for the existent customers and partners. Burtons should invest in its employees, training them to develop their interpersonal skills to deal with practical details of customers and their ability to handle complains and problems in order to exceed customer expectations about the services quality presented. Burtons can provide some sort of loyalty program for the existent customers to reward and motivate them to deal more with the company; this will enhance their relationship with the company and retain them at a lower cost of marketing.

Cooking as an Art Form Essay

Food, cooking, and whatever related to these themes are usually considered as an art because food is an everyday item that has a wide meaning for all people. Food can be considered as an art; for example: the decoration of a food, the way a food is constructed in the plates, or even the way many different foods are being mixed in order to create a new food. Sometimes even people consider the arrangement of plates in a table as an art. This is called Table Art. Brillat-Savarin in his book, â€Å"The physiology of taste† states that cooking is the oldest of all arts. He says that Adam was born hungry and even a new born child first looks for become feed by his nurse right after he comes to new world (Physiology of taste, 300). He also believes that cooking and food is the finest art that has had the most influence on humans’ civilization (300). Food is one of the fewest things in whole world that almost everyone becomes satisfied with. When people eat, a kind of satisfaction and pleasure make them happy. And whatever can make a person happy could be considered as an art. Gastronomy is the knowledge and science of whatever related to human’s nourishment (physiology of taste, 51). Savarin believes that Gastronomy is a part of cookery. The way the dishes are adapted and arranged in a table and the way a food is tasted make the food as an art work (physiology of taste, 51). Savarin by his philosophical look explain the joy and sadness that a food can cause by its taste. He says that taste gives us the greatest joy because eating is the only thing which is not followed by regret (physiology of taste, 42). Brillat-Savarin says that the knowledge of Gastronomy is important for everyone. â€Å"There is this special advantage in their gastronomical knowledge, that they attain through it a completely personal note in the way their table is maintained; they are able to supervise up to a certain point the arrangements which they must then entrust to others, and they may even direct them occasionally†. Preparation of food is as much important as the food itself. Only a good cook can prepare a food in its best way and the final product is what everyone would like to try. Brillat-Savarin in his book explains how a skilled cook can make a fish that become an immense source of pleasure. He explains different ways it can be prepared, served in whole, cut in fillets or sliced, whether boiled or fried, cold or hot. And what he believes is that it would be always acceptable (physiology of taste, 91). Sometimes only professional cooks can make an astonishing dish because every one does not have the skill and techniques of preparation of a dish. For example when John Barlow wanted to try the ear part of the pig he found it a little disgusting before he saw the dish but after they prepare his dish he said: â€Å"The culinary art, I guess, often involve artifice. Things are cooked so as to disguise their ugly origins. An oxtail, for example, doesn’t really look like an ox’s tail; it looks brown and glazed and beautiful, like a slow-roasted half-brogue† (Everything but the squeal, 208). Savarin interestingly explains the different usage of sugar in his book and he describes how skillful a man should be in order to mix sugar with different other things to prepare a good product. For instance, sugar mixed with water that is refreshing and healthy, mixed with wine which produces cordials, or mixed with flour and eggs, the result is sponge cakes, muffins, and uncountable delicious pastries which are all the product of skillful cook (physiology of taste, 102 & 103). In the Gourmet’s diary of a foodie, it was so amazing when Chef Dani Garci was making fantastic dishes by some simple ingredients, like: Green and red Gazpacho and Ajo Blanco which are traditional dishes of south Spain. The most significant part is that how they take their times to make these dishes. They are like an art work that an artist put all his time and skill on it to create the best work. It was so amazing when he was making those tomato skins which were frozen in nitrogen. He was using all his skill to make them and coat them with red color. Food and cooking just same as music can inspire people. Usually when people listen to music they like to dance. It is the inspiration of music and brings people together to dance. Food and cooking do the same thing as music does. Gourmands are people who are fond of good eating and Gourmandism has an important effect in our social life. It spreads the spirit of entertainment and friendship which brings together different kinds of people, make a friendly atmosphere that people mingle and melt in to conversation, and vanish the inequalities of position and breeding (physiology of taste, 153). Also it will motivate the host to do his best in order to make the best table for his guests and take care of them. The host uses his knowledge and techniques to please his guests. Brillat-Savarin states,† any preparation which springs from a high intelligence demands explicit praise, and a tactful expression of appreciation must always be made whenever it is plain that there is any attempt to please† (153). Savarin explains the origin of the table in his book and he brings the note that one of the most important and strong laws of human being is to respect for any one with whom one has shared bread and salt. He says that it happens during the meals that languages should have born and perfected (physiology of taste, 182). From the other point of his view, he explains the effect of Truffles and how it inspires humans.â€Å"whosever pronounces the word truffle gives voice to one which awakens erotic and gastronomical dreams equally in the sex that wears skirts and the one that sprouts a beard† (Savarin, 93). Savarin by his explanations believes that truffle is the diamond of the art of cookery (physiology of taste, 95). The art of food and cooking is really one of the greatest works by a human being in history. The power of table, unbelievable different tastes, techniques of preparation, and all other aspects that concern about food and cooking should really considered as an art. John Barlow in his book â€Å"Everything but the squeal†, demonstrates the power of table and how a table can bring people around the table. Indeed, it is like a movie scene when he was sitting next to a family and he noticed that how they stare down at their table before they start eating, he says their elbows were raised and explains how the table was prepared and arranged, the way the forks and knives were next to dishes (Barlow, 145). In fact, these kinds of excitements are the result of foods and cooking’s art. In Gourmet’s diary of foodie, there is a connection between the traditional foods of gypsies and the art and skill of cooking. Manuel Valencia who is a chef and author wrote a book about the traditional gypsy foods. He explains what constitute gypsy foods in his books. In the video it is really interesting to see how they cook while they are dancing and how they manage the table and guests. It is the art of gypsies that can entertain their guests and serve them delicious foods by simple ingredients. They prepare nice dishes with the lowest costs and of course this would not be done only if you are a professional cook. Also I noticed that how they prepare Iberico Hams in Spain. It is said in the video that from the dehesa to the table will take 4 years. So what do they do during these years is all about preparing the most delicious ham in the world which obviously is so expensive. To conclude this, it is important to know that cooking and whatever is related to foods and cooking is one of the finest arts conceived by human and it should be considered as art in all aspects and themes of cooking, from preparing to eating.

World War II And The Korean War - 2296 Words

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War in modern times has been the inclusion of civilians and civilian infrastructure as targets in destroying the enemy s ability to engage in war.[disputed – discuss] The targeting of civilians developed from two distinct theories.[citation needed] The first theory was that if enough civilians were killed, factories could not function. The second theory was that if civilians were killed, the enemy would be so demoralized that it would have no ability to wage further war.[citation needed] However, UNICEF reports that civilian fatalities are down from 20 percentShow MoreRelatedThe Nuclear Of The Korean War1147 Words   |  5 Pages World War II ended suddenly as America destroyed two Japanese cities not with traditional strategic bombing, yet with the extremely powerful atomic bombs. As a result of dropping the atomic bombs, the world was thrust into the nuclear age. Just a few short years after World War II, the Korean War started. 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