Audit Memo

Name:

Institutional Affiliation

Audit Memo

审计assignment代写 Enterprise risk refers to the risk that may affect the businesses in a negative light particularly on the···

Enterprise Risk 审计assignment代写

Enterprise risk refers to the risk that may affect the businesses in a negative light particularly on the financial statements such that . The accounts do not reflect the true and fair value or may negatively affect the business operations. Some of the risks affecting the business include:

1.Inherent risk

This refers to the risk that the account balances or class of transactions are materially misstated either individually . Or when they are aggregated together as a group. In businesses, various factors may enhance the probability of these inherent risks occurring . Such factors may include situations when the management’s performance is pegged on profitability.

This can be seen as a risk for NAII especially with the stock-based compensation that has been put in place. When this is the case profits can be manipulated in order to favor the said parties particularly the directors. Under the incentive plan that was approved by the directors, it is well within their power to provide nonqualified . And incentive stock options and other awards to employees.

Another factor that can easily accelerate the inherent risk would be the nature of the business product, and mainly . In this case, the company NAII offers leading formulator . And marketer of nutritional supplies. In this line of business, there are several lines of products it deals with particularly the scientific research . And clinical studies which may be quite difficult to quantify as it is a service . And with such the services can easily be misappropriated or misstated.

2.Credit Risk 审计assignment代写

This is another potential risk likely to face the firm especially in terms of liquidity risk. This type of risk would translate to the fact that the company is not able to meet its daily operating need . As well as being able to pay its creditors. The organization placed its cash with some very high financial instructions while in respect to its debtors . Their three largest clients represented to an average of about 73% of the total debtors . Which means it is basically holding up your cash rather than receiving the cash and meeting its operation needs as well as the organization can re-invest such cash.

3.Foreign Exchange risk

This refers to the risk that the company will face due to the fluctuation in the foreign exchange rate. The uncertainty in the rate may end up causing or having a financial impact on the company. To be more specific this fluctuation may either cause gains or losses to the company. The company is affected in two ways in terms of the exchange rate that it is.

The company has a foreign subsidiary hence all the transaction that . The company makes with the foreign subsidiary have to be converted using the existing foreign exchange rate at that time. Another way the company is affected is in terms of the sales that the companies make to foreign countries which . Must be made using the foreign currencies of that country.

Information Risk 审计assignment代写

This refers to the type of risk that is most likely to face the users if the published financial statements contain a misleading piece of information . And the said users rely on the said information. Users of this financial information can include:

1.Potential Investors

These refer to the capital providers, and their advisors are normally concerned with the ability of the company to pay dividends. They are more interested in the return on their investments. From the financial statements of NAII, they are interested in the income statement specifically the dividends paid out.

2.Employees 审计assignment代写

They are users of the information particularly the profitability of the company since if the company is profitable . It will be able to pay their salaries.

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3.Customers

These are the clients that the company NAII services . And hence they are interested in the going concern of the company that is the continuity of the enterprise if they have a long-term investment with the company. The going concern of the can be clearly since it has non-current liability . Which refers to liabilities that the company intends to pay after more than twelve months.

Some of the areas that might require special attention during the audit might include areas such as: 审计assignment代写

a.The adoption of the recently adopted accounting pronouncements . Which specifically is the revenue from contracts with customers which means we as the auditors need to ensure that this accounting standard has been fully adopted and well implemented.

b.Another area that may require special is the stock-based compensation plan that was implemented. This requires special attention in order to ensure that it is not used a money laundering scheme . By the management in the name of an incentive plan.

c.Lastly, another critical area that may require the auditor’s essential attention is the contingencies section . Which might pose a legal risk to the company. The auditors need to identify the reason why the company is facing such contingencies particularly the lawsuits.

Engagement Risk 审计assignment代写

An engagement is a contact sent by the auditor to the client briefly outlining the scope of the work and the various responsibilities of the auditor, therefore, minimizing misunderstanding of the auditor’s role. One of the critical objectives of this letter or contact is that it confirms the auditor’s acceptance and in so doing it affirms any verbal communication between the auditor and the client.

Therefore the engagement risk will be the risk faced by the auditor if the contents or purpose are wrongly misrepresented such that the clients misunderstand the role of the auditor or in this case of NAII, the auditor does not do proper client screening and background check of the client and as a result once they accept the client, whatever risks they face down the line is their own fault.

Some of the changes that have taken place since the June 2018 audit . 审计assignment代写

And where attention needs to be focused on is the company . NAII started dealing with new products particularly the private label contract manufacturing. The sales for this new product pose a significant risk to the company since the company might not have the legal knowledge in regards to dealing with that product.

This will pose a threat to the auditors since, we as the auditors need to acquire the necessary knowledge, skill and at times will need to acquire the necessary. There is also another engagement risk that the auditors might face which is the technical risk in terms of understanding the shipment process of the new products.

Materiality 审计assignment代写

From the balance sheet, the allowance for the doubtful debts can be taken as material in respect to the account’s receivables. However, this allowance can only be material to the debtors but are not pervasive to the entire financial statement.

From the statement of the comprehensive statement of income, the unrealized gains or losses arising from the change in fair value of derivative instruments. This aspect is material but not pervasive and hence we as the auditors can only issue an except for opinion. From the same statement, there is provision for the income taxes, this provision can end up being material in terms of the actual taxes for the year can end up being higher or lower than the provision, and this might end up being material to the financial statements.

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References 审计assignment代写

Natural Alternatives International, Inc. (NAII) SEC Filings. (n.d.). Retrieved from https://www.nasdaq.com/symbol/naii/sec-filings

Naii20181231_10q.htm. (n.d.). Retrieved from https://www.sec.gov/Archives/edgar/data/787253/000143774919002336/naii20181231_10q.htm

 


审计备忘录

名称

机构隶属关系

审计备忘录

企业风险

企业风险是指可能对企业产生负面影响的风险,尤其是对财务报表的影响,以致账目不能反映真实和公允价值或对业务运营产生负面影响。影响业务的一些风险包括:

一,固有风险

这是指帐户余额或交易类别被严重错失的风险,无论是单独还是将它们汇总为一组。在企业中,各种因素可能会增加这些固有风险发生的可能性,这些因素可能包括管理层的绩效与获利能力挂钩的情况。可以将其视为NAII的风险,尤其是已经实施了基于股票的薪酬。在这种情况下,可以操纵利润以使所述当事方特别是董事受益。根据董事批准的激励计划,完全有能力向员工提供不合格和激励性的股票期权及其他奖励。
可以轻易增加内在风险的另一个因素是商业产品的性质,主要是在这种情况下,NAII公司提供领先的配方师和营养供应商。在此业务类别中,有几条产品线涉及特别是科学研究和临床研究,这可能很难量化,因为它是一项服务,并且这样的服务很容易被盗用或误用。

二,信用风险

这是公司可能面临的另一种潜在风险,特别是在流动性风险方面。这种风险将转化为以下事实:公司无法满足其日常运营需求,也无法偿还其债权人。该组织将其现金放在一些非常高的财务指示下,而就其债务人而言,他们的三个最大客户平均约占债务人总数的73%,这意味着它基本上是在保留您的现金,而不是接受现金和开会。它的运营需求以及组织可以将这些现金再投资。

三,外汇风险

这是指公司因汇率波动而面临的风险。费率的不确定性最终可能导致对公司的影响或对公司产生财务影响。更具体地说,这种波动可能会给公司带来收益或损失。公司受到汇率影响的方式有两种:该公司有一家外国子公司,因此该公司与该外国子公司进行的所有交易都必须使用当时的现有汇率进行换算。公司受到影响的另一种方式是,公司对国外的销售必须使用该国的外币进行。
信息风险
这是指如果已发布的财务报表包含误导性信息并且所述用户依赖所述信息,则最有可能面对用户的风险类型。此财务信息的用户可以包括:

i。潜在投资者

这些是指资金提供者,其顾问通常关心公司支付股息的能力。他们对投资回报更感兴趣。从NAII的财务报表中,他们对损益表特别是所支付的股息感兴趣。

ii。员工

他们是信息的使用者,尤其是公司的盈利能力,因为如果公司盈利,则可以支付他们的薪水。

iii。客户

这些是公司NAII服务的客户,因此,如果他们对公司进行长期投资,他们会对公司的持续经营感兴趣,这是企业的连续性。由于公司具有非流动负债,这是公司打算在超过十二个月后支付的负债,因此它的持续经营可以很明显地看出来。

在审核过程中可能需要特别注意的一些领域可能包括:
采用最近采用的会计声明,特别是与客户签订的合同所产生的收入,这意味着我们(作为审计师)需要确保已完全采用和良好实施此会计准则。
可能需要特别注意的另一个领域是已实施的基于股票的薪酬计划。这需要特别注意,以确保管理层不以奖励计划的名义使用洗钱计划。
最后,可能需要审计人员重点关注的另一个关键领域是突发事件部分,这可能会对公司构成法律风险。审计师需要确定公司面临此类突发事件的原因,尤其是诉讼。

参与风险

约定是审计师发送给客户的联系,简要概述了工作范围和审计师的各种职责,从而最大程度地减少了对审计师角色的误解。这封信或联系书的主要目的之一是确认审核员的接受,并以此确认审核员与客户之间的任何口头交流。因此,如果错误地陈述了内容或目的,以致客户误解了审计师的角色,或者在NAII的情况下,审计师不会对客户进行适当的客户筛选和背景调查,则聘用风险将是审计师面临的风险。客户,因此一旦他们接受了客户,他们面临的任何风险都是他们自己的错。
自2018年6月审核以来发生的一些变化,需要重点关注的是公司,NAII开始处理新产品,特别是自有品牌合同制造。由于该公司可能不具有处理该产品的法律知识,因此该新产品的销售给公司带来了重大风险。这将对审核员构成威胁,因为作为审核员,我们需要获得必要的知识,技能,有时还需要获得必要的知识。审核员可能还会面临另一种参与风险,即在了解新产品的运输过程方面的技术风险。

实质性

从资产负债表中,呆账准备金可以作为应收账款的重要组成部分。但是,该准备金仅对债务人而言是实质性的,而并不遍及整个财务报表。
从综合收益表中可以看出,衍生工具公允价值变动产生的未实现损益。这方面是实质性的,但不是普遍的,因此,作为审计师,我们只能发表例外意见。根据同一报表,有所得税准备金,该准备金最终可能对当年的实际税项而言可能高于或低于该准备金,并且可能最终对财务产生重大影响陈述。

References

Natural Alternatives International, Inc. (NAII) SEC Filings. (n.d.). Retrieved from https://www.nasdaq.com/symbol/naii/sec-filings

Naii20181231_10q.htm. (n.d.). Retrieved from https://www.sec.gov/Archives/edgar/data/787253/000143774919002336/naii20181231_10q.htm

 
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