BEC 01 Flashcards
Treadway commission established by?
private sponsoring organizations to combat fraudulent reporting.
What is the role of the BOD?
Act as a fiduciary for the company.
If a person makes fictitious checks
bank reconciliations do not help because recs focus on the cash balance which is after the fact.
What is one of the requirements for SARBNES OXLEY?
BOD of directors must have an independent audit committee.
Who needs to make special certification statements regarding establishment of IC on 10-k forms?
Principal executive officer and financial officer.
Picking ticket can be found where in the process?
manufacturing process
What creates a logical flow for business processes?
Data flow diagram
Purchasing power or inflation premium
Part of the risk rate return
Effective interest rate
multiply actual interest rate less additional interest earned. Divided by loan proceeds.
The Internal control framework
creating policies and controls related to internal controls would be under existing control activities.
debt ratio
total liabilities over total assets
debt to equity
for every ex. 1.75 in debt there Is a 1.00 equity
What Is the times earned interest ratio?
ebit/interest expense, you have to add back pre tax income and interest expense first.
CAPM
risk free rate plus beta multiplied by the market return-rfr
How to calculate cost of preferred stock?
dividend paid over net proceeds, which will give you the cost of preferred shares.
