ACC 5400 Lecture Notes - Lecture 21: Financial Statement, Audit Evidence
24 Oct 2018
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Chose control reliance approach ( strategy decision: good set of internal controls, change our strategy and decide to test controls in all rlly imp areas, might include matters such as: In some industries the transactions, and the accounting, is more complex than in others: some industries are more volatile and subject to sudden change than others. High tech companies have great ideas: but btw now and next year from ipo, you have a major competitor, go from buyable to one that is not doing well. Similar w oil and gas: price of oil goes down oil operators have to shut down operations, risk and loss of profit, a lot of volatility. Industry and external environment: reasons for obtaining an understanding of the, client"s industry and external environment: Inherent risks common to all clients in certain industries. Unique accounting requirements: major sources of revenue, and how company is paid.
