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GENERALLY ACCEPTED AUDITING STANDARDSApril 10, 1996 Generally Accepted Auditing Standards are those guidelines which auditors must adhere to while conducting an audit of a company's or government entity's financial statements. It must also be stated in the audit report that the audit was conducted following Generally Accepted Auditing Standards. This has been required since 1941 after the investigation of a large drug company, McKesson & Robbins, Inc., which had had funds embezzled by i

EVA is a way of measuring a firm's profitability. EVA is NOPAT minus a charge for all capital invested in the business (Byrne 1). A more intuitive way to think of EVA is as the difference between a firms NOPAT and its total cost of capital (Kramer & Pushner 40). Stern Staurt's numerical definition of EVA is calculated for any year by multiplying a firm's economic book value of capital at the beginning of the year by the spread between its return on capital and its cost of capital (K): E

Creative accountingBackground and baselineFinancial statements are bound by laws and accounting standards. To break these is anoffence and enforced as such. Judges enforce the letter of the law and where there are loopholes, the law may be changed.For judges the spirit of the law does not exist. However finance is too complicated to havea set of water-tight rules. For example an ASB working committee was meant to resolve howgoodwill should be handled and in 1995 they came up with 5 alt

1. Identification of the company being described Company A: Manufacturer of toiletries, non-prescription drugs, and consumer and baby care products. Analysis: · Compared with Co. B, Co. A has a higher gross margin equivalent to 63.1 percent. Company B: Manufacturer of pharmaceuticals and low-margin hospital supplies. Analysis: · Goodwill can be seen on the other assets portion of the balance sheet. Co. B has a significant amount of other assets (40.6 %). · Compared to Co.

STATEMENT OF CASH FLOWS Information about cash flows can influence decision makers in many ways . For example , if a company’s regular operations bring in more cash than it uses , investors will value the company higher than if property and equipment must be sold to finance operations . Information about cash flow can help creditors decide whether a company will have enough cash to pay its debts as they mature. Management and investors use cash flow information to evaluate a compan

While analyzing the financial statements of Costco for the years 1995-1999 we concluded that the years were successful in terms of revenue and earning. Due to their success the company is able to provide low prices to individuals and businesses in almost 300 locations worldwide. Since there is such a steady growth in most area Costco has been able to open 100 new stores within the last 5 years and only closed 28 in the process. Although they have had a steady increase in assets and liabilitie

Bill Davis Accounting Dell Computers Brief Back Ground Dell Computers is one of the world's top PC makers and the world's #1 direct-sale computer vendor. Led by founder Michael Dell -- the longest-tenured CEO of any major US computer company, who owns 12% of his creation -- the company sells hardware and markets third-party software and peripherals. Products include PCs (about 55% of sales), notebooks, and network servers. Government entities, large businesses, and educational instituti

Bill Davis Accounting Dell Computers Brief Back Ground Dell Computers is one of the world's top PC makers and the world's #1 direct-sale computer vendor. Led by founder Michael Dell -- the longest-tenured CEO of any major US computer company, who owns 12% of his creation -- the company sells hardware and markets third-party software and peripherals. Products include PCs (about 55% of sales), notebooks, and network servers. Government entities, large businesses, and educational insti

The Balance Sheet Although the balance sheet was first implemented just a couple of centuries ago, it has quckly developed and sophisticated to become nowadays a widely used and powerful tool in the hands of professional users, well known and popular even among the mass public. In spite of its prominence, or may be because of it, the balance sheet can not be easily and fully described in a few words, but still, if we leave aside its various functions and forms and any other subject

Part A 1. Directors AJ lane, WJ Locke, JF Kelly, JR Cadwaallader, DG Lane, HA Lynch, IA Pollard, RC Milne 2. Total Sales = $475,264,000 (1997) (Before Abnormal items) 3. Sales revenue for the consolidated entity, for the year ended 30 June 1996, was $449745000. 4. Equity method used when company has significance influence but not control of investee company OPSM use consolidation method which means it has control over other investee. 5. Total interest expenses for the consolidated ent