An Audit Analysis

A. BACKGROUND laser applied science is a all in all owned subsidiary of Lightray Inc., a connection listed on the in the altogether York Stock Exchange. optical maser Engineering is a conjunction which manufactures and retail distribution of high engine room engineering equipment. Laser Engineering is an Australian based company which has 2 subsidiaries, paladin Supply Pty Ltd and Bell Manufacturing Pty Ltd. The Board of Directors of Laser Engineering consists of two directors of Lightray Inc. and three Australian directors, Sandra Thomas (Managing Director), rouse Jackson (Finance Director) and Dave Chan (Operations Director). In terms of capital structure, the company relies significantly on the fairness rather than debt in the year 2003. On the contrary, the company relies to a great extent on debt in the year 2004. By feeling at the figure in the Draft Statement of monetary Position, this whitethorn increase the risk of going concern problems which lead be discuss ed later. Being a high technology company, it whitethorn parade to high inherent risk, because of the complexity of valuation of enquiry and Development. The explore and Development cost has been capitalized even though the gross taxation of the new machine have been disappointing. SWOT ANALYSIS probable home(a) strengths 1.         Adequate financial resources by the p atomic consequence 18nt company in the United States. 2.          equal leadership concentrating on a new machine which is more accurate and more than cheaper than others already available in the market. Potential internal weaknesses 1.          racy debt to equity ratio (Appendix 1). 2.         Obsolete stock of machines which are out-dated may affect the inventory turnover ratio and government emerge on total assets. 3.         Poor quality of employees specifically on hiring the temporary accounting staff. There is a likelihood of parody to be committed. 4.         La! ck of integrity and objectivity of management as management is potentially biased as they have an incentive to prepare a report that reflects... If you want to get a full essay, order it on our website: OrderCustomPaper.com

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