Tolerable Misstatement Assignment Example | Topics and Well Written Essays - 1000 words

Tolerable Misstatement - Assignment Example There is normally a high risk of misstatement for accounts receivable as there is a possibility that debts may not be collectible due to the inability of customers (debtors) to pay. It is important to ensure that the amounts are collectible so that adequate provisions can be made. Tests should be done to determine the age of the debts in comparison to the terms given to debtors’ confirmations should also be sent on the bass of materiality. Additionally, the auditor should ensure that amounts stated as receivables are not disputed due to poor record keeping or inadequate controls over cash receipts. The amount represented by 2% is $172. Therefore, if the amounts are misstated by that amount it is not a major problem. However, if the amount by which the figure is misstated is greater than $172 then there is a cause for concern. The receivables figure has declined by over 30% while revenues have increased. It is important to determine the reason for this. Receivables are suscepti ble to both intentional and unintentional misstatements and a lot of work will be required to verify such balances. Prepaid advertising $200 The tolerable misstatement of 2% is within the limits recommended (Willis & Adams 3-2). Prepaid advertising is a current asset that may be fairly easy to check as it involves making a determination of the amount paid for advertising. However, if the number of advertisements is large or the dates when the advertisement should start and end are not recorded then there is the risk that it may be misstated. Explanations to support Work Paper 3-8, continuing ACCOUNT NAME TOLERABLE MISSTATEMENT EXPLANATION Computer hardware and software $400 The change over prior year is approximately 8% and indicates that there were substantial additions to this fixed asset. It is normal that all additions to fixed assets are verified. Additionally, the amounts amortized should be tested to ensure that the computations are accurate. Furthermore, they should be check ed to ensure that the assets included are properly classified. However, a 1% misstatement is immaterial and therefore tolerable (Willis & Adams 3-2). Leasehold improvements $150 The tolerable misstatement of 5% appears to be rather high since this is a fixed asset. This type of asset normally requires 100% verification. However, there has been no major change in leasehold improvements from the prior year. Willis & Adams (3-2) indicates that the tolerable limit for total assets is 0.5%. When compared to total assets the amount is very immaterial and so a tolerable limit of 5% for this asset is immaterial. Accumulated depreciation and amortization $150 The amount for depreciation is prone to error and it has to be thoroughly checked. There has been an approximate 15% increase and this increase needs to be verified. There is really no room for error as its calculation is very objective. Explanations to support Work Paper 3-8, continuing ACCOUNT NAME TOLERABLE MISSTATEMENT EXPLANATION I ntangible assets, net $100 The valuation of intangible assets is subjective and so there is the risk of misstatement. Although the change is approximately 300% it is not large in comparison to other fixed assets. Since the total amount is small a tolerable misstatement of 6% would not significantly affect the materiality levels for total fixed assets. Accounts payable $180 Accounts payable is prone to misstatement and so companies are prone

''Citizen Kane'' Review Essay Example | Topics and Well Written Essays - 750 words

''Citizen Kane'' Review - Essay Example The story begins with the protagonist as an old man on his death bed, alone in his expensive mansion without family or friends. As he utters his last word, â€Å"Rosebud†, a journalist sets out on a journey of investigation to discover the meaning of Kane’s last word. It is through this exploration, including interviews with family members and associates, that we are told the life story of Kane, from childhood as a member of a poverty stricken family, through to his move into the newspaper industry as he develops a position of huge and influential power within the medium as his personal life disintegrates. One of the most innovative and important techniques and aspects of the movie is its narrative techniques. The story is told through a series of flashbacks, and not necessarily in chronological order. In addition to this, the story is entirely non-linear in that it is told through the perspective and points of view of multiple characters (Cook, 2004). Such characters i nclude much older individuals who have different interpretations and opposing descriptions of the protagonist. This non-linear storytelling technique which incorporates multiple narrators, including unreliable narrators, was extremely innovative of the time. Though a few previous movies had attempted this to some degree, â€Å"Citizen Kane† exploited this technique and based the structure of the entire movie upon this strategy. This is an extremely effective device and very appropriate for this particular movie. As the character is presented as something of an enigma, this is reflected through the multiple, diverse perspective and views of the protagonist by the many people in his life. The audience never fully understands the charcter, his motivations, intentions, emotions and true desires. Just as the journalist becomes more confused with the more information he gets on Kane, so too the audience remains relatively mystified by the character. Another aspect of the movie whic h has garnered much well deserved acclaim is the cinematography. Welles apparently attempted to create a new style of making films, by trying to combine several such techniques into one cohesive method. This resulted in many new and innovative aspects to the movies cinematography. For example, the director employed several low-angle shots and used deep focus extensively (Cook, 2004). This was extremely modern and new for the time period, as the limitations and typical settings of movies restricted such techniques. One of the central themes of the movie is the inability to fully understand and categorise an individual’s life, certainly without their input, and the film explores this very successfully. Despite Kane’s achievements and wealth, the journalist still cannot understand his final word â€Å"Rosebud†. It is not until the end of the film that the audience is allowed insight into the meaning of the word, which has entirely nothing to do with the protagonist ’s professional career or successes. This reflects the fact that it is almost impossible to truly understand another person and that relying n the perspectives and interpretations of others is an extremely unreliable source (Sparknotes, 2012). The movie overall, certainly deserves it’s substantial critical acclaim and merits. The innovative cinematography and storytelling structure were highly creative and effective devices to use at the time. Orson Welles as