Destructive Leadership the Cause, Effect, and Aftermath

Destructive Leadership: The Cause, Effect, and Aftermath Snehal Kavi University of Maryland, University College Abstract This paper explores the behaviors of a destructive leader, and how this negativity affected the leader’s subordinates. Several peer-reviewed articles support the ideas that decision-making, influence tactics, power, and emotional intelligence create a successful leader. However, these traits were non-existent in a particular leaders case, which led to undesirable behaviors throughout the organization. The operational manager at a pain management company incessantly belittled and humiliated her subordinates, exerting power in the incorrect manner. This leader had little knowledge and expertise in her field, did not†¦show more content†¦Freed (2011) defines a leader as a strong, wise, emotional, and intelligent person who can help those who are weaker. Britni also provided direction and motivation to site managers to excel the efforts of their teams every week, month, or year. This however, made it easy for Britni to ridicule managers who were at the bottom of t he list. Pollach Kerbler (2011) define a leader as someone whose â€Å"strong charisma, reputation, and symbolic power can have a positive effect on corporate reputation, corporate performance, [and] organizational effectiveness† (p. 355). Through these definitions and various others, it is a common thread that a leader should be likeable, able to motivate and influence, and powerful. A leader should hold some power over the individuals being led, to allow the leader to gain a sense of authority. With this power, the individuals, being led, begin to respect, listen, and follow what their leader asks of them (Colquitt et al, 2013). Power also allows the leader to reward and punish individuals based on their performance (Colquitt et al, 2013). A major task of the operational manager at Kure is to determine what value of the quarterly bonus would be given to each individual site manager, based on performance. Freed (2011) states, â€Å"the motivational philosophy of carr ots (rewards) andShow MoreRelated Hurricane Katrina: A Man-made Disaster Essay1364 Words   |  6 PagesEDT on August 29, 2005 Hurricane Katrina made landfall, etching lasting memories of those living in and around the New Orleans, Louisiana. It was this day that Hurricane Katrina came ashore and caused what was to be thought as one of the â€Å"most destructive storm in terms of economic losses† (Hurricane Katrina —, 2007) of all times. Who was to be blamed for the failure in emergence management response and preparation, no one seemed to know or understand. Those left in the wake of this disasterRead MoreThe Effects Of Stress On The Body s Normal State1402 Words   |  6 PagesStress is the body’s reaction to internal or external stimuli that upset the body’s normal state. A stimulus that causes stress that can physical, mental, or emotional. The term stress is used to refer to both the body’s reaction and the stimuli that caused it. The bo dy’s reaction to highly stressful situations is known as the flight or fight response. Under stressful circumstances, quantities of adrenaline, a hormone produced by the adrenal glands that are released into the bloodstream. This stimulatesRead MoreA New Paradigm Of Terrorism1537 Words   |  7 Pagesthe pursuit of political change.’ (2001:3) However, in his own article he offers only a systematic clarification of terrorism in stating their aim to ‘undermine confidence in government and leadership’ (2002:313), which remains unchanged despite the context. Hoffman’s central argument focuses on the aftermath of 9/11 and therefore his definition holds the purpose of rethinking counterterrorism measures and merely as a byproduct in showing potential modern threats. To accurately analyse whether ‘NewRead MoreCan Weapons Of Mass Destruction Be Justified?1618 Words   |  7 Pagesjustified because it follows the rules of the Just war theory. WMD’s can’t be justified WMD’s cannot be justified as they cause mass destruction and kill the innocent. It will never be just to kill so many people and harm the environment. There are massive side effects when nuclear weapons are used, both economic and environmental; these problems can cause long term effects. WMD’s are also very expensive to make and maintain, it costs countries billions of pounds each year to maintain their weaponsRead MoreThe Disaster Planning Or Management1847 Words   |  8 PagesMorris, Fitzgerald, and Milanes, 2009, p306). By early September, people were forcibly evacuated and the storm displaced more than 1.5 million people (Lalwani, et al., 2007, p10). According to Lalwani, et al. (2007, p10), â€Å"Katrina was the most destructive and costliest natural disaster in the history of the United States,† with an estimated $75 billion worth of damage. Months after the hurricane, 3,200 people were unaccounted for and many of the low-lying areas, most of which were poor and minorityRead MoreThe Impact Of Organizational Activity On The Performance Of A Large Scale Organization Like The State And Its Patterns Of Response2183 Words   |  9 Pagespriori was ambiguous. Lastly, in accordance with the organizational model, major crisis in government’s behavior reflects the lack of coordination of its parts, which in turn causes interdependent outputs. The failure to launch the warnings effectively could be seen as a result of miscommunication and of lack of leadership in order to ensure that common repertoires were fulfilled under high pressure. OECD Model: the importance of having the flexibility and capacity of innovate under pressure AccordingRead MoreEssay On Revolutionary War1760 Words   |  8 PagesAmerican Colonists, should be the ones paying for the Army through the form of taxes. The American who had a history of â€Å"salutary neglect,† in which the Thirteen Colonies really never had to deal with the British government collecting taxes until the aftermath of the French and Indian War. This is what started a lot of talk of the colonies wanting independence, just paying for taxes to pay for the army that the Colonies wanted to protect themselves from further French and or Indian threats. Colonist consistentlyRead MoreTerrorism, State Terror And Terrorism Essay2005 Words   |  9 Pagesthese events are ambiguous and unreliable. The earliest accounts of genocide can be found in some of the world’s oldest literary works such as The Illiad and The Bible. However, a concise definition or understanding of genocide did occur until the aftermath of the Holocaust in 1945. After the Holocaust, the United Nations sought to codify genocide during The Convention of the Prevention and Punishment of the Crime of Genocide. The Convention defined genocide as â€Å"acts committed with the intent toRead MoreThe Battle Of Fort Fisher2012 Words   |  9 Pagesmasonry retaining its shape form the slopes given to the parapets, scarp, and counterscarp, with the aid of gabions and other temporary expedients. Our knowledge of it is imperfect, but enough is known to enable us to form as correct a judgment of the effects of the proposed explosion in the open air in front of it, as though we possessed as much detail as in the preceding case of Fort Caswell. The light-house situated in this fort or immediately adjacent thereto, was at the date of our last survey (1856)Read MoreEssay on National Missile Defense4089 Words   |  17 Pagesballistic missiles that are increasingly accurate and powerful. In fact, the Soviets has the ability to overwhelm the United States missiles on the ground should a conflict ever occur. Arms race is a vicious cycle in itself and will not contribute to the cause of world peace. Therefore, to render this advantage impotent and obsolete, President Reagan directs the nation’s talented and government agencies to begin exploring and researching programs that will achieve the ultimate goal of eliminating threats

The White Queen Called It, Living Backwards - 2138 Words

The White Queen called it â€Å"living backwards.† She was referring, of course, to life on the other side of a looking glass. Indeed, traveling through a looking glass, if it were possible, would be a contortion of space, a reversal of the orderly world in the â€Å"frontward† side of the glass with the disorder found in the â€Å"backward† side. Everything would, like the queen said, be turned around. So if someone in Victorian England squeezed herself through a looking glass, she might find, instead of the classic Victorian ideal of the tranquil home where the husband brought home the bacon and the wife happily cooked it, homes in which strong wives dominated weak, ineffectual husbands and husbands who, instead of coming home each evening to restore themselves within the loving familial bond, escaped that bond by taking long naps and dreaming strange dreams. Indeed, instead of finding homes in which the spaces between marriage partners were narrowed, someone w andering through a looking glass world would find emotional gulfs between partners, gulfs that even the most stringent Victorian ideals could not close. These emotional spaces in Lewis Carroll’s Through The Looking Glass and What Alice Found There can be seen through another lens as well. While Alice, the book’s heroine, metaphorically grows into adulthood as she moves her way across the fictional chessboard, the author remains static; Carroll watches wistfully as the emotional space between himself andShow MoreRelatedExploring The Mind Of A 1960s Teenage Boy1329 Words   |  6 Pagesappearance†Ã¢â‚¬â€yes, I’m bringing psychology into my paper) a â€Å"goon.† Finally, Sammy spotted â€Å"†¦the third one, that wasn’t quite so tall. She was the queen. She kind of led them, the other two peeking around and making their shoulders round (19).† True to the way he described her, Sammy called this girl â€Å"Queenie† because she appeared to be the leader of the group—their queen. It was immediately obvious that Sammy was drawn to this girl because while he briefly described the other two, he spent a large amount ofRead MoreOprah, By Oprah Gail Winfrey1019 Words   |  5 Pagesmostly for The Oprah Winfrey Show. It is the highest-rated talk show of all time, running for 25 years. She has dealt with many early life issues which has made her the tough, devoted, and inspirational person she is today. Oprah can be known as â€Å"The Queen of All Media.† Her loyalty to her audience has inspired many, along with the entertainment she gives her fans. Experts call her the most influential woman in the world. Oprah enjoys giving back to charities along with starting her own charities. OprahRead MoreOrientalism, Imperialism, And Culture Clash Essay1167 Words   |  5 Pagesthe divided clash between them that western culture has pushed from Oriental notions of other cultures and Imperial power on them b elieving that the views and culture of Western life are better for other people more than their own culture and way of living to establish power. These systems of power that still divide men and women create the idea that a person is either of American/Western culture or of the cultural life of where they came from. The construction of these systems by men show the chauvinisticRead MoreOprah Winfrey: Rise to Fame1664 Words   |  7 Pagesboundaries often bring a new element and creativity to their chosen profession. Often their ideas and work are scrutinized. Few people would have bet on Oprah Winfreys swift rise to host of the most popular talk show on TV. In a field dominated by white males, she is a black female of ample bulk. As interviewers go, she is no match for, say, Phil Donahue [...] What she lacks in journalistic toughness, she makes up for in plainspoken curiosity, robust humor and, above all empathy. Guests with sadRead MoreAlice’s Adventures in Wonderland and Through the Looking Glass1929 Words   |  8 Pageshole from a great height and grow over ten feet tall. Alice also is called a serpent by a bird after her neck grows to an unusual height. Alice’s questioning of her own self is not uncommon in the work. She wonders it several times through the fantasy land she has been thrown into. Lenny writes â€Å"After falling through the Rabbit hole, Alice tests her knowledge to determine whether she has become another girl. Later on, the White Rabbit mistakes her for his maid Mary Ann. When the CaterpillarRead MoreAmerica s Greatest Weapon Against The Nazi Regime1890 Words   |  8 Pagesbrings dreams of home.† When Christopher Columbus set sail in 1492, his flagship, the Santa Maria, carried the flag of Queen Isabella. That flag had the image of a castle on it, along with the inscription â€Å"Ne Plus Ultra† meaning â€Å"nothing further.† At the time, Spain was considered the most western part of the world. When Columbus returned to Spain and reported his findings to the queen, she ordered a painter to change the flag to read â€Å"Plus Ultra,† which means â€Å"more beyond† or â€Å"more out there.† HopeRead MoreEssay about An Analysis of Orientalism by Edward Said2112 Words   |  9 Pagesself-determination in their own ways. Many reasons explain the need for conquest of the Orient. These reasons essentially fall under four categories: political, economic, moral, and socio-cultural. Politically, the English Empire was highly important to the Queen. She wanted to expand her powers and sovereignty, which in turn would provide more legitimacy to the thrown. Economically, the imperial economy ran on the â€Å"gifts† of the conquered colonies. Thus, an incentive existed to find a new land, take itRead MoreEssay Colonization Across the Globe5171 Words   |  21 Pagesthe working language of that country to this day is Portuguese, while most of the rest of the continent speaks Spanish. On 1 August 1498, during his third voyage, Columbus finally sighted the South American mainland for the first time. The next white explorer to reach the continent was the Portuguese navigator Pedro Cabral, who anchored off the coast of present day Brazil in April 1500 - a territory which he then claimed for Portugal. However, the claim was ignored for more than 30 years by PortugalRead MoreEssay about The Zulu Clan3287 Words   |  14 PagesThe Zulu Clan In the 1820s, during a period of social unrest and warfare, the Zulu clan, a Bantu people, rose to political prominence under the great King Shaka in present-day South Africa. This period is called mfecane, or crushing because it was characterized by Shakas tyrannous reign during which he conquered neighboring peoples and established a kingdom for the Zulu people on South Africas eastern coast. The word zulu was used in 1824 to refer to a war-like race of South AfricanRead MoreCub A Picture Of Life2612 Words   |  11 Pagesdiscuss different traditions that have stayed alive while Castro’s empire has been in power. The following information is based off of phone calls with my own personal family members in Cuba who are living and surviving every day in Cuba. My mother’s family is from a small farm village outside of Havana called Vevado. In the Hernandez household there are 21 and counting people. My cousins take care of a small farm to help feed everyone in the village. The stereotypes are very old fashion. The women cook

Revenue Cycle Essay Example For Students

Revenue Cycle Essay AUDITING THE REVENUE CYCLE Audit procedures associated with the revenue cycle is the main point in this report. Basically, it is divided into three sections. First, it begins with a review of alternative technologies used in both legacy and modern system. The focus is on the key operational task performed under each technological environment. The second section discusses the revenue cycle audit objectives, controls and test of controls that an auditor would perform to gather evidence needed to limit the scope, timing and extent of substantive tests. The last section describes revenue cycle substantive tests in relation to audit objectives. OVERVIEW OF REVENUE CYCLE TECHNOLOGIES Technology and automation are integral to successful financial leaders strategy to offset rising expenses and improve operating income. The most efficient revenue cycle will use best practice processes enabled by highly optimized technology. By using this combination of process and technology, organizations may realize efficiencies driven by improved workflows; reduced manual intervention; and more relevant, reliable, and timely decision-support information. This section examines alternative information technologies used in the revenue cycle. The first of these is a sales order system that employs batch processing and uses sequential files for storing accounting records. This is an example of an early legacy type system. This approach characterizes the era of data ownership in which files were designed exclusively for the use of a single user. Second is a cash receipt system that employs batch processing and uses direct access files. This configuration is found in both modern systems and late-era legacy systems. The direct access file approach offers operational advantages over sequential file processing and permits limited data sharing. The final system is a modern real-time sales order entry and cash receipts system that uses database technology. Modern systems design embraces reengineering to radically reshape business processes and workflow. This process involves replacing traditional procedures with procedures that are innovative and sometimes very different from those that previously existed. Information Technologies Used in the Revenue Cycle I. Batch processing system using sequential files Batch processing using sequential files involves two procedures: ? Manual procedures ? Automated procedures Batch processing system using sequential files Manual procedures In this basic system, order taking, credit checking, warehousing and shipping are performed manually. The following discussion outlines the key features of the system. 1. Obtaining and recording the customers’ order The sales process begins in the sales department with the receipt of a customer order indicating the type and quantity of merchandise being requested. The primary objective of this step is to ensure that the relevant data about the transaction are transcribed into a standard format that can be processed by the selling entity’s system. The document prepared in this procedure is the sales order. The process begin as the sales order captures vital information such as the name and address of the customer; the customer’s account number; the name, number and description of the item sold; the quantities and unit prices of each item sold; and other financial information such as taxes, discounts and freight charges. In manual systems, multiple copies of sales order are produced to serve different purposes. After preparing the sales order, the sales clerk files one copy of it in the customer open order file for future reference. Since the process is done manually, filling the order and getting the product to the customer may take days or even weeks. 2. Approving Credit The next step in the revenue cycle is transaction authorization, which involves verifying the customers’ creditworthiness. The circumstances of the sale will determine the nature of the credit check. In our system, the credit authorization copy of the sales order is sent to the credit department for approval. The returned approval triggers the release of the other sales order copies simultaneously to various departments. The credit copy is filed in the customer open order file until the transaction is complete. 3. Processing Shipping Orders The final step is the processing of shipping orders. The sales department sends the stock release copy of the sale order to the warehouse. After picking the stock, the clerk initials the stock release copy to indicate that the order is complete and accurate. The clerk then adjusts the stock records to reflect the reduction in inventory. Updating the inventory accounting records is an automated procedure that will be discussed later. Batch processing system using sequential files Automated procedures This is an automated operation. The computer system described here is an example of a legacy system that employs the sequential file structure for its accounting records. Both tapes and disks can be used as the physical storage medium for such system. However the use of tapes has declined considerably in recent years. Most organizations that still use sequential files store them on disks that are permanently connected it the computer system and require no human intervention. The following are the main points of batch processing system using sequential files Automated procedures: 1. Keypunch/Data Entry The process begins with the arrival of batches of shipping notices from the shipping department. These documents are copies of the sales orders that contain accurate information about the number of units shipped and information about the carrier. The data processing clerk converts the shipping notices to magnetic media to produce a transaction file of sales orders. Typically this process is continual. Batch control totals are calculated for each batch on the file. 2. Edit run The edit program is the first run in the batch process. This program validates transactions by testing each record for the existence of clerical or logical errors. Later, these are corrected by an authorized person and resubmitted for processing with the next day’s business. The edit program recalculates the batch control totals to reflect changes due to the removal of error records. The clean transaction file is then passed to the next run in the process. 3. Sort Run The sort run physically arranges the sales order transaction file sequentially by account number, which is one of its secondary keys. To process a sequential transaction file, it must be placed in the same sequence as the master file that it is updating. 4. AR Update and Billing Run This procedure creates a new AR_SUB master file that incorporates all the changes to the customer accounts that are affected by transaction records. The original AR-SUB master file remains complete and unchanged by the process. The creation of new and separate master file is a characteristic of sequential file processing. 5. Sort and Inventory Update Runs The sort program sorts the sales order file on the other secondary key- Inventory Number. The inventory update program reduces the quantity-on-hand field in the affected inventory records by the quantity sold field in each sales order record. A new inventory master file is created in the process. In addition, the program compares values of the quantity-on-hand and the reorder point fields to identify inventory items that need to be replenished. 6. General Ledger Update Run Under the sequential file approach, the general ledger master file is not updated after each batch of transactions. To do so would result in the recreation of the entire general ledger every time a batch of transactions is processed. Firms using sequential files typically employ separate end-of-day procedures to update the general ledger accounts. Batch processing system using sequential files will generate a number of management reports. This may include sales summaries, inventory status reports, transaction listings, journal voucher listings and budget and performance reports. II. Batch Cash Receipts System with Direct Access Files Cash receipts procedures are natural batch systems. They are not continuously occurring throughout the day because they are basically discrete events. Checks and remittance advices arrive from the postal service in batches. Same as deposit of cash receipts in bank which usually happens as a single event at the end of the business day. Technology employed in this receipt system uses direct access files and batch processing which then is used to automate traditional procedures. The following discussion outlines the main points of this system: 1. Mailroom The mailroom separates the checks and remittance advices and prepares a remittance list. These checks and a copy of remittance list are sent to the cash receipts department. 2. Cash Receipts Department The cash receipts clerk reconciles the checks and the remittance list and prepares the deposit slips. The remittance list and one copy of deposit slip are then filed. At the end of the day, the clerk deposits the cash in the bank. 3. Accounts Receivable Department The accounts receivable clerk receives and reconciles the remittance advices and remittance list. Via terminal, the clerk creates the cash receipts transaction file based on the individual remittance advices. The clerk then files the remittance advices and remittance list. 4. Data Processing Department At the end of the day, the batch program reconciles the journal voucher with the transaction file of cash receipts and updates the AR-SUB and the general ledger control accounts. This process employs the direct access method described earlier. Finally, the system produces a transaction listing that the accounts receivable clerk will reconcile against the remittance list. III. Real-Time Sales Order Entry and Cash Receipts This system provides real-time input and output with batch updating of only some of the master files. It replaces manual procedures and physically documents with interactive computer terminals just like a reengineered sales order system. The main points of the system are the following: 1. Order Entry Procedure Sales Procedures Under real-time processing, sales clerks receiving orders from customers process each transaction separately as it is received. Using a computer terminal connected to an edit/inquiry program, the clerk performs the following task in real time mode: 1. Perform a credit check online by accessing the customer credit file 2. If credit is approved, the clerk then accesses the inventory master file and checks the availability of the inventory. 3. The system automatically transmits an electronic stock release record to the warehouse and a shipping notice to the shipping department, and records the sale in the open sales order file. Warehouse Procedure The warehouse clerk’s terminal immediately produces a hard copy printout of the electronically transmitted stock release document. The clerk then picks the goods and sends them along with a copy o the stock release document to the shipping department. Shipping and Billing The shipping clerk reconciles the goods, the stock release document, and the hard copy packing slip produced on the terminal. The clerk then selects the carrier and prepares the goods for shipment. From a terminal, the clerk transmits a shipping notice containing invoice, date, and carrier information to create a shipping log of the event. The transaction record is removed from the open sales order file and added to the sales invoice file. Finally, drawing from data in the customer file, the system automatically prepares the customer’s bill. 2. Cash Receipts Procedure In this system, each invoice is billed and paid individually. Cash from customers may be received and processed as just described or may be sent directly to a bank lock-box. In either case, the remittance advices are sent to the accounts receivable function, where the clerk enters them into the system via a terminal. Each remittance record is assigned a unique remittance number and is added to the remittance file. Placing the remittance number and the current date in the respective fields then closes the corresponding open invoice record. Features of Real-Time processing This system is a departure from traditional accounting. A central feature of the system is the use of an events database. Traditional accounting records may not exist per se. In theory such system does not even need a general ledger because sales, sales returns, accounts receivable-control and cost of goods sold can all be derived from the invoices in the events database. Most organizations, however, prefer to maintain a separate general ledger file for efficiency and as a cross check of processing accuracy. The four advantages which make this approach attractive option for many organizations are the following: 1. Real-time processing greatly shortens the cash cycle of the firm. 2. Real-time processing can give a firm a competitive advantage in the market-place. 3. Manual procedures tend to produce clerical errors, such as incorrect account numbers, invalid inventory numbers and price-quantity extension miscalculations. 4. Real-time processing reduces the amount of paper documents in a system. REVENUE CYCLE AUDIT OBJECTIVES, CONTROLS AND TEST OF CONTROLS Input controls Input controls are designed to ensure that the transactions are valid, accurate, and complete. Control techniques vary considerably between batch and real time systems. The following input controls relate to revenue cycle operations: Credit Authorization Procedure The purpose of the credit check is to establish the creditworthiness of the customer. Only customer transactions that meet the organization’s credit standards are valid and should be processed further. In batch systems with manual credit authorization procedures, the credit department is responsible for implementing the firm’s credit policies. Testing Credit Procedures Failure to apply credit policy correctly and consistently has implications for the adequacy of the organization’s allowance for uncollectible accounts. The following tests provide evidence pertaining to the valuation/allocation audit objectives and to a lesser extent, the accuracy objective. The auditor needs, therefore, 1. to determine that effective procedures exist to establish appropriate credit limits; 2. ommunicate this information adequately to the credit policy decision makers; 3. review credit policy periodically and revise it as necessary; and 4. monitor adherence to current credit policy. The auditor can verify the correctness of programmed decision rules by using either: ? Test Data ? Integrated Test Facility This testing is easily accomplished by creating several dummy customer accounts wit h various lines of credit and then processing test transactions that will exceed some of the credit limit. The auditor can then analyze the rejected transactions to determine if the computer application correctly applied the credit policy. The integrity of reference data is an important element in testing credit policy controls. A correctly functioning computer application cannot successfully apply credit policy if customer credit limits are excessively high or can be changed by unauthorized personnel. Substantive Tests traditionally follow test of controls because the results of test of controls because the results of test of controls are used to determine the nature, timing, and extent of the substantive tests. In this case, however, substantive tests may be the most efficient way to verify if credit policy is being properly applied. Data Validation Controls In the batch system, data validation occurs only after the goods have been shipped. Extensive error logs, error correction, and transaction resubmission procedures characterize such systems. General Types of Validation Tests that are relevant to the revenue cycle includes: ? Missing Data Checks ? Numeric-Alphabetic Data Checks ? Limit Checks ? Range Checks ? Validity Checks ? Check Digit Testing Validation Controls Data entry errors that slip through edit programs undetected can cause recorded accounts receivable and revenue amounts to be materially misstated. The audit procedures described provide evidence about the accuracy assertion. The central audit issue is whether the validation programs in the data editing system are functioning correctly and have continued to function as intended throughout the period. Testing the logic of a validation program, however, represents a significant undertaking. The auditor may decide to rely on the quality of other controls to provide the assurance needed to reduce substantive testing. Batch Controls Batch Controls are used to manage high volumes of transaction data through a system. The objective of batch control is to reconcile output produced by the system with the input originally entered into the system. While initiated at the data input stage, batch control continues through all phases of data processing. An important element of batch control is the batch transmittal sheet which captures relevant information about the batch, such as the following: ? A unique batch number ? A batch date ? A transaction code ? The number of records ? The number of records in the batch ? The total dollar value of a financial field ? The total of a unique nonfinancial field Testing Batch Controls Hesters Story EssayIn most organizations, this means that sales are recognized only when the products are shipped. The auditor should review the shipping log for the following period to determine if the missing invoice numbers are recorded there. If so, this would indicate that the merchandise was shipped after the cutoff period. It may be necessary to adjust the sales and accounts receivable balances accordingly. Review Line Item and Inventory Files for Sales Price Accuracy Evidence from testing the product prices charged to customers supports the audit objective of accuracy. Sometimes sales are given limited authority to negotiate prices with customers. Significant discrepancies between the suggested retail price and the price actually charged, however, may indicate incompetence, clerical errors, or sales personnel exceeding their authority. Auditors would verify pricing accuracy by comparing sales prices on the invoices with the published price list. But because of the physical effort involved with this approach, it could be done only on a sample basis. Therefore, out of thousands of sales records, perhaps only one or two hundred would be tested. ACL allows the auditor to compare the prices charged on every invoice in the file for the period under review. Testing for Unmatched Records There are two possible causes for unmatched records: ? First, the value of the item number field in the line item record is incorrect and does not match an inventory record. Since the operational assumption is that the inventory master file is correct, then any line item records in the unmatched file are errors. The presence or absence of such errors is evidence that refutes or corroborates the accuracy assertions. ? Second, the inventory file. The presence of inventory records in the unmatched file means that there were no corresponding records in the line item file. This result is not an error; it means that these products did not sell during the period. After adjusting for any seasonal influences on sales, such evidence may refute the valuation assertion. The auditor may require that the inventory be written down to reflect its market value. Testing the Existence Assertion One of the most widely performed tests of existence is the confirmation of accounts receivable. This test involves direct written contact between the auditors and the client’s customers to confirm account balances and transactions. Statement on Auditing Standards No. 7, the Confirmation Process, states that auditors should request confirmations of accounts receivable except in the following three situations: 1. accounts receivable are immaterial; 2. based on a review of internal controls, the auditor has assessed control risk to be low; or 3. the confirmation process will be ineffective. Because of the way some organizations account for their liabilities, they may be u nable to respond to requests for confirmation. Government agencies and large industrial organizations often use an open-invoice system for liabilities. Under this approach, invoices are recorded individually rather than being summarized or grouped by creditor. In this environment, no accounts payable subsidiary ledger exists. Each invoice is paid as it comes due. For financial reporting purposes, total accounts payable is calculated simply by summing the open invoices. Determining the liability due to a particular creditor, which may consist of multiple invoices, is not such a simple task. The auditor should not assume that an organization using this approach would invest the time needed to respond to the confirmation request. Under such circumstances, the confirmation process would be ineffective. Selecting Accounts to Confirm Selecting accounts receivable for confirmation involves processing data that are contained in both the customer and the sales invoice files. Each customer record is associated with one or more sales invoice records. The sales invoice file provides the financial information needed for the confirmation requests, and the customer mailing information is contained in the customer file. Obtaining a set of accounts for confirmation requires three steps: 1. CONSOLIDATE INVOICES. ACL’s classify command allows the auditor to set a filter to select only the open sales invoices and to summarize the invoice amount field for each record based on the customer number. The summarized records are then passed to a new file called classified invoices. 2. JOIN THE FILES. The join feature allows the auditor to select only relevant fields from each of the input files when creating the new file. 3. SELECT A SAMPLE OF ACCOUNTS. To assist the auditor in this task, ACL’s sample feature offers two basic sampling methods: random or record sampling and monetary unit sampling. The choice of methods will depend on the auditor’s strategy and the composition of the accounts receivable file. If the account balances are fairly evenly distributed, the auditor may want an unbiased sample and will thus choose the random sample approach. Under this method, each record, regardless of the size of the accounts receivable balance, has an equal chance of being included in the sample. If, on the other hand, the file is heavily skewed with large customer account balances, the auditor may select MUS, which will produce a sample biased toward the larger dollar amounts. ACL’s size command helps the auditor calculate sample size and sampling intervals based on the auditor’s desired confidence level, the size of the population being sampled, and the assessed materiality threshold. Preparing Confirmation Requests The confirmation requests contain the information captured in the AR-Sample file. The requests, which usually take the form of letters, are drafted and administered by the auditor, but are written in the client entity’s name. In a positive confirmation letter, recipients are asked to respond whether their records agree or disagree with the amount stated. These are particularly useful when the auditor suspects that a large number of accounts may be in dispute. They are also used when confirming unusual or large balances or when a large proportion of total accounts receivable arise from a small number of significant customers. A problem with positive confirmation is poor response rate. Customers that do not dispute the amount shown in the confirmation letter may not respond. The auditor cannot assume, however, that lack of response means agreement. To obtain highest response rate possible, second and even third requests may need to be sent to nonrespondents. Negative confirmations request the recipients to respond only if they disagree with the amount shown in the letter. This technique is used primarily when accounts receivable consist of a large number of low-value balances and the control risk of misstatement is considered to be low. The sample size for this type of test typically large and may include the entire population. Evidence from nonreturned negative confirmations selected from a large population provides indirect evidence to support the auditor’s expectation that accounts receivable are not materially misstated. Since the egative confirmations approach does not prove that the intended recipients actually received and reviewed the confirmation letters, evidence of individual misstatements provided by returned responses cannot be projected to the entire population. In other words, responses to negative confirmations cannot be used as a basis for determining the total dollar amount of the misstatement in the account. Suc h evidence can be used, however, to reinforce the auditor’s prior expectation that the account balance may be materially misstated and that additional testing of details is needed to determine the nature and amount of misstatement. ACL’s export features can greatly facilitate the physical task of inserting the relevant financial data for each customer into the individual letters. Using this option, the auditor can produce a text version of the AR-Sample file that can be integrated with the confirmation letter text using mail/merge feature of a word processing package such as Microsoft Word or WordPerfect. This facility greatly reduces the clerical effort traditionally associated with confirmation activities. Evaluating and Controlling Responses Evidence provided through confirmations is less reliable when contact between the auditor and the debtor is disrupted by client intervention. The auditor should take all reasonable steps to ensure the following procedures are observed: ? The auditor should retain custody of the confirmation letters until they are mailed; ? The confirmation letters, together with the self-addressed stamped envelopes, should be addressed to the auditor, rather than the client organization; and ? The confirmation request should be mailed by the auditor. If client mailroom personnel participate in the process, they should be adequately supervised. Nonresponses to positive confirmation also need to be investigated. SAS 67 requires auditors to use alternative procedures to resolve this issue. A commonly used procedure is to review the following period’s closed invoices to determine if the accounts were actually paid. Testing the Valuation/Allocation Assertion The auditor’s objective regarding proper valuation and allocation is to corroborate or refute that accounts receivable are stated at net realizable value. This objective rests on the reasonableness of the allowance for doubtful accounts, which is derived from aged accounts receivable balances. To achieve this objective, the auditor needs to review the accounts receivable aging process to determine that the allowance for doubtful accounts is adequate. . APPENDIX A. Batch Processing with Sequential Files B. Sales Order C. Bill of Lading D. Batch Processing with Sequential Files E. Real Time Sales Order Entry and Cash Receipts F. File Structure for the Revenue Cycle G. Relationship between Management Assertions and Revenue Cycle Audit Objectives H. Confirmation Letter FIGURE 9-1. Batch Processing with Sequential Files SALES CREDITDATA PROCESSING WAREHOUSE SHIPPING FIGURE 9-2. Sales Order CHARGE SALE INVOICE MONTEREY PENINSULA CO-OPINVOICE NUMBER_______ 527 River Road Chicago, IL 60612 (312) 555-0407 SOLD TO FIRM NAME______________________________INVOICE DATE__________ ATTENTION OF___________________________PREPARED BY__________ ADDRESS_______________________________CREDIT TERMS_________ CITY____________________________________ STATE_______ZIP________________________ CUSTOMER PURCHASE ORDER NUMBER________________________________SHIPMENT DATE________ DATE___________________________________SHIPPED VIA___________ SIGNED BY______________________________BOL NO. _______________ QUANTITY ORDERED |PRODUCT NUMBER |DESCRIPTION |QUANTITY SHIPPED |UNIT PRICE |TOTAL | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |TOTAL SALE | | | | |CUSTOMER ACCT. NO. | | | |VERIFICATION | FIGURE 9-3. Bill of Lading UNIFORM STRAIGHT BILL OF LADING-Domestic Monterey Peninsula Co-opDocument No. __________ 527 River Road Chicago, IL 60612 (312) 555-0407Shipper No. __________________________ Carrier No. ___________________________ Date________________________________ TO: Consignee________________________________________ Street____________________________________________ City/State Zip Code______________________________ (Name of Carrier) ____________________________________________________________ _________________________ Route: Vehicle____________ |No. Shipping units |Kind of packaging, description of articles, special marks and |Weight |Rate |Charges | | |exceptions | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | TOTAL CHARGES $ | | | |The agreed or declared value of the property is herby |IF WITHOUT RECOURSE: |specifically stated by the shipper to be not exceeding: |The carrier shall not make delivery of this shipment | |$____________per___________________ |without payment of freight | | |_____________________________ | | |(Signature of Consignor) | | | | |FREIGHT CHARGES |Signature below signifies that the goods described above | |Check appropriate box: |are in apparent good order, except as noted. Shipper | | Freight prepaid |hereby certifies that he is familiar with all the bill of | | Collect |lading terms and agrees with them. | | Bill to shipper | | |SHIPPER Monterey Peninsula Co-op |CARRIER | |PER |PER DATE | (This bill of lading is to signed by the shipper and agent of the carrier issuing the name. ) CONSIGNEE FIGURE 9-4. Batch Processing with Sequential Files ____ MAILROOM ___ CASH RECEIPTS_______________ACCOUNTS RECEIVABLE ____ DATA PROCESSING CONTROLLER OFFICE_______ FIGURE 9-5. Real Time Sales Order Entry and Cash Receipts _____ CUSTOMER SALES DEPARTMENT____________DATA PROCESSING DEPARTMENT____ _______WAREHOUSE________SHIPPING DEPARTMENT_____ FIGURE 9-6. File Structure for the Revenue Cycle PK |Customer | Customer |Street |City |State |Zip |Credit | |Number |Name |Address | | |Code |Limit | Customer File PK SK Invoice | Customer |Invoice |Sales |Due |Closed |Remittance | |Number |Name |Amount |Date |Date |Date |Number | Sales Invoice File PK |Invoice |Item |Sales |Quantity |Extended | |Number |Number |Price | |Price | Line Item File SK PK |Item |Description |Warehouse |Quantity on | |Number | |Location |Hand | PK SK Management Assertions Revenue Cycle Audit Objectives | | | | | | | | | TABLE 1. Relationship between Management Assertions and Revenue Cycle Audit Objectives FIGURE 9-7. Confirmation Letter CLIENT LETTERHEAD (CLIENT NAME AND ADDRESS) (Name and Address of Client’s Customer) To Whom It May Concern: In accordance with the request from our external auditors, we ask that you confirm your outstanding account balance with our organization. Our records indicate that your account balances as of (end-of-period date) amounted to ($ amount). If your records agree with this balance, please indicate by signing in the space provided below and return this letter directly to our auditor’s using the enclosed envelope. Your prompt compliance with this request is greatly appreciated. If the amount indicated is not in agreement with your records, inform the auditors directly using the enclosed envelope. In your response, please show the amount owed according to your records and include full details of the discrepancy. Sincerely, (Name of the Entity) The amount stated above is correct: (Customer Name) Customer Customer order Receive customer order and prepare sales order File A Customer copy Credit copy Stock release Packing slip Shipping notice File copy Customer order Credit copy Check credit Credit copy Key strokes Sales order file Edit Edited file Errors Sort program Sorted SO file AR update and billing program Sales orders Sort run Sorted SO file Old AR files New AR files Sales journal Journal voucher Old GL file New GL file Sorted journal vouchers Sorted journal vouchers General ledger update Management reports Customer’s invoice Customer Management Shipping notice Master file update program Sort sales order file by customer account number Old inventory file New inventory file End of day BATCH process File copy Shipping notice Packing slip Stock release Reconcile documents and goods, sign shipping notice, and prepare BOL Shipping notice Stock release Pick goods and send to shipping Stock release A File copy Stock release BOL File BOL BOL Packing slip Carrier Shipping Log File Inventory File Carrier BOL BOL Stock release Packing slip Terminal Reconcile goods with packing slip and prepare bill of lading Packing slip Terminal Stock release Terminal Accounts Receivable Terminal Remittance advice Credit memo Inventory file Record sales invoice and shipment Sales invoices Existence or OccurrenceVerify that the accounts receivable balance represents amounts actually owed to the organization at the Balance Sheet Date. CompletenessDetermine that all amounts owed to the organization at the balance sheet date are reflected in accounts receivable. Verify that all sales for shipped goods, all services rendered, and all returns and allowances for the period are reflected in the financial statements. AccuracyVerify that revenue transactions are accurately computed and based on current prices and correct quantities. Ensure that the accounts receivable subsidiary ledger, the Sales Invoice file, and the Remittance file are mathematically correct and agree with general ledger accounts. Rights and ObligationsDetermine that the organization has a legal right to recorded accounts receivable. Customer accounts that have been sold or factored have been removed from the accounts receivable balance. Valuation and AllocationDetermine that accounts receivable balance states its net realizable value. Establish that the allocation for uncollectible accounts is appropriate. Presentation and DisclosureVerify accounts receivable and revenues reported for the period are properly described and classified in the financial statements. Transaction listing of AR update Cash rec journal Gen Ledger accounts Accounts receivable Master file update program Journal vouchers Cash Rec Trans file Date entry program B A File Bank File Transaction listing of AR update Review Remittance advice Remittance list B Terminal Update AR ledger Remittance advice Remittance list A Terminal Record cash receipt Deposit slip Deposit slip Deposit slip Remittance list Check Remittance list Check Remittance advice Check Remittance list Remittance list Remittance list Remittance advice Check Customer Inventory file Record sales invoice and shipment Customer file Open sales orders Check, credit and update inventory Inventory file Customer file Customer invoice Terminal Customer order Clerk reconciles deposit slip from bank and cash receipts remittance list Reconciles checks with the RA and prepares remittance list Deposit slip Bank Remittance list Management Management reports

The Death of a Toad free essay sample

In Richard Wilbur’s poem â€Å"The Death of a Toad,† he describes the finals moments of a toad’s life and the first changes to the toad upon its death. Wilbur makes the transition of a toad’s death that is tragic because of the lack of attention and concern given to it. As he continues the poem, he shifts the tone from tragic to the peacefulness and respect of a hero. Wilbur exercises heavily loaded diction and vivid imagery corresponding to the tones in order to depict the toad’s death as tragic and heroic. The heavily loaded diction brings tragedy to the toad’s death and progresses to characterizing the toad as a hero. In line four, Wilbur references â€Å"cineraria leaves. † These words announce the death of the toad that was foreshadowed in the title. The leaves the toad lies on will eventually become what will hold the toad’s ashes. We will write a custom essay sample on The Death of a Toad or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page It is tragic because the toad seems so insignificant to world, including the power mover’s operator. In line five, Wilbur continues describing the toad’s leaves as having â€Å"a dim, low, and final glade. † The toad’s death appears even more tragic because it will fade away and will be forgotten. The words in the second stanza emphasize the tragedy: â€Å"As still as if he would return to stone†¦dies toward some deep monotone. † When the toad metaphorically returns to stone, the toad’s life, presence, and existence is gone, with no one to mourn and remember the toad. The monotone Wilbur mentions presents the idea that the world before and after the life of the toad will not change. However, finally in the third stanza, Wilbur’s diction gives importance and heroicness to the dead toad. The speaker describes the toad’s movement â€Å"toward lost Amphibia’s emperies. † Similar to the life of the toad, the amphibian empires are lost. Although Amphibia’s emperies are lost, the assumption of this the other amphibians, this life and death of this toad are important and deserving of a heroic funeral. Thus, Wilbur’s loaded diction addresses the tragedy of the toad’s death and transitions to his heroism and importance in his amphibian community. Wilbur’s imagery creates the feelings of tragedy and heroism as the poem’s tones shift. When the toad’s leg is â€Å"chewed and clipped† by the power mower, the speaker paints a picture of a toad hopping along a grassy lawn and unexpectedly being injured by the lawn mower. The tragedy is in that the toad was not expecting to be hurt that day or in that moment, but this simple misfortune led to the death of the toad. When he describes the â€Å"ashen heartshaped leaves,† he illustrates literal heart-shaped leaves covered in the toad’s dark ashes. The toad’s death affects the natural beauty of the environment because it covers up the leaves, thus, it is tragic. In the second stanza, when the toad â€Å"flows in the gutters of the banked,† Wilbur represent the unpleasant image of a dead toad being picked up from the place of its death under the tree and being moved by water into the sewer. Ironically, water keeps toads alive—that is their natural habitat—but does nothing to bring the toad to life. Instead, it carries the toad to its place of glory, which is its Amphibian empire. The beautiful imagery associated with the empire gives it esteem. The empire’s â€Å"misted and ebullient seas and cooling shores† form an aura of peacefulness. The phrase â€Å"rest in peace† is often associated with death, and Wilbur provides a place for the toad’s peaceful after its messy death. The shift from gloomy imagery to peacefulness helps present the speaker’s tone transition from tragic to heroic. Richard Wilbur’s shifts in imagery and loaded diction set the tone major tones in â€Å"The Death of a Toad. † The imagery begins gloomy, just like the death of the toad, which helps create a tragic mood in the poem. As the poem continues, the images become peaceful, esteemed, and more heroic. Similarly, the loaded diction creates a change in the tone. The diction begins sorrowful but eventually transforms and included words of admiration and significance. Therefore, Richard Wilbur’s â€Å"The Death of a Toad† is a poem tells of the tragic death of a toad that becomes a hero in an amphibian empire.