Auditing case study Essay Example | Topics and Well Written Essays - 2000 words

Auditing case study - Essay Example ’s best performing market with a 4% rise in sales even though its export sales recorded a 1% contraction when compared to the previous financial year. Overall group data reported that sales into the U.S.A market rose by 24% whilst the European market indicated a 12% decline. The company’s overall profitability was assisted by the strengthening of the US dollar when compared with the sterling pound during this period. 2. The company’s profit before tax stood at  £2,052,000 in 2012/13 when compared with 2011/12 whereby it stood at  £843,000 before the IAS 19 pension adjustment. The main expenditure stood at  £555,000. The other expenses were  £228,000 which was mostly related to executive transition costs. Looking at their major products, Technical Fiber Products had an operating profit standing at  £1,450,000 compared to 2011/12 when it stood at  £629,000. Their turnover figures grew by about 6% on the preceding year’s turnover figure of  £12,599,000. Sales in the Defense and Aerospace sectors represented an 18% and 20% of the overall sales respectively. The sales of TFP into the U.S.A increased by 16% and 17% in US dollar and Sterling terms respectively. The U.S.A represented the TFPs most important market with which accounted for about 55% of its turnover while it stood at 50% over the preceding year. It was however not so rosy in when looking at the same sales out o f the U.S.A which shrunk by about 6%. The company took several steps aimed at consolidating the US operations. It closed the Cincinnati facility in mid-2012 while it will take until the third quarter of 2013 for the new facility at Schenectady to achieve to several consumer programs. The Schenectady facility needed an investment about US$3million initially. In conclusion, there is heightened audit risk in revenue area. 1. According to the annual report, the company is undergoing major re alignments in its principle market in the U.S .The closures of the Cincinnati plant and future closure of