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Auditing Presentation

Cathy Pham

on 3 May 2013

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Transcript of Staples

not Gibrilla Barrie
Cathy Pham
Jerrin Raju
Michael Rohm
Alex Tran Gibrilla Barrie
Cathy Pham
Jerrin Raju
Michael Rohm
Alex Tran Analysis
& Audit Plan that was easy. AUDIT PLAN High & Low Risk Accounts QUESTIONS? Leading Office Supplies Retailer
Businesses Headquartered in Framingham, Massachusetts Business:
Sell Office Products
Offer Office Related Services Competitors: Quill.com
Corporate Express Locations:
1547 U.S.
668 Internationally Revenue: 24.38 Billion
Net Profit: (160.73M)
Number of Employees: 69,662
Stock Price (4/30/2013): $13.18 1. Unemployment rate increase

2. Lack of Small Business Formation

3. Foreign Currencies Exchange Affect 1. Highly Competitive

2. Product Mix & Quality

3. Expansion Internationally GAAP - IFRS
Inventory 1. Managing supply chain
2. Online Presence
3. Competitive Prices
4. Convenience Wage and Hour Laws
U.S Foreign Corrupt Practice Act
Import and Export Laws
International Laws and Regulations Net Operating Loss: 160.728 Million
Working Capital: 1.7 Billion
Total Assets: Over 12 Billion (Inventory/Property)

2012: $9.65B Market Cap
EPS: $.31
Diluted EPS: $(0.31)

2011: $16.55B Market Cap
EPS: $1.42
Diluted EPS: $1.40

Obtained $500 million 2.75% senior note
Retained $1.2 Billion under commercial paper program Financial position is marginal.
Profit margin: SPLS = -.66%, OMX = 6.08
Debt to assets: SPLS = 16.2, OMX = 25.66 Planning Materiality Payroll and Personnel Cycle Repayment & Capital
Acquisition Cycle Inventory and Warehousing Cycle Financial
Cycles Sales and Collection Cycle Payment and Acquisition Cycle
$1.3 billion balance
0.05% or $6.5 million is the
maximum tolerable misstatement Restructuring Costs
Accounts Receivable
Inventory Cash
Buildings High Risk Audit - Inventory Operations in 23 Countries Geological Allocations of Audit Physical Inventory Subcontract audit to local firms and partners Valuation Procedures Trace Quantities Vouch Inventory Purchases, BOM Low Risk Audit - Cash to Success General Laws: Economic Factors Business Risk Overhead Rates Accounting Considerations: Observe Internal Controls Observe Internal Controls Bank Confirmations Background Information Subsidiaries: Inspect items Perform Reconciliation Interbank Transfers Closer Look at the Financials Physical Count of Cash Strong internal controls
less testing
lower chance of misstatements High Risk Low Risk Outlook and industry comparison
Office Max Employee layoffs in fiscal year 2012: 1,307 Financials
Full transcript