Submit a draft of risk factors as identified for all of the major business transactions conducted by your chosen company. Analyze the income statement, balance sheet, and cash and revenue for any potential risk factors and compliance issues with Generally Accepted Accounting Principles (GAAP) or International Financial Recording Standards (IFRS). Based on your analysis of risk, devise a statistical and judgmental sampling program for the audit universe. Recommend the most preferable audit testing procedure based on the audit universe items sampled.

ACC 640 Milestone Two Guidelines and Rubric Auditing is a valuable skill in accounting and business, as the odds are very high that you or your organization will be subject to a compliance, federal, IRS, internal, government, or revenue audit at one point in your career. Accountants are required to make professional judgments on both the financial accounting issues and internal accounting forecasts within their organization. The auditor must provide fair, unbiased, materially correct information for investors, employers, employees, and independent stakeholders. This course will help you navigate the relevant processes to provide that unbiased, accurate information. For Milestone Two, you will submit a draft of risk factors as identified for all of the major business transactions conducted by your chosen company. Analyze the income statement, balance sheet, and cash and revenue for any potential risk factors and compliance issues with Generally Accepted Accounting Principles (GAAP) or International Financial Recording Standards (IFRS). Based on your analysis of risk, devise a statistical and judgmental sampling program for the audit universe. Recommend the most preferable audit testing procedure based on the audit universe items sampled. Prompt: Analyze potential risk factors in all the major business transactions using the information you have gathered in previous milestones. Specifically, the following critical elements must be addressed: A. Analyze the income statement for any potential risk factors and compliance issues with Generally Accepted Accounting Principles (GAAP) or International Financial Recording Standards (IFRS). B. Analyze the risk factors and compliance issues with GAAP or IFRS on the balance sheet. C. Using the internal control, analyze the cash and revenue for potential risk factors. 1. What risks need to be documented? 2. How does this information compare to the company or industry averages, or the company's past performance? D. Explain the audit universe and how you identified it. E. Based on your analysis of risk, devise a sampling program for the audit universe. F. Choose the most preferable audit testing procedures that could be used in the field, based on the audit universe items sampled in this situation. Rubric Guidelines for Submission: Your paper must be submitted as a 3-4-page Microsoft Word document with double spacing, 12-point Times New Roman font, oneinch margins, and at least three sources cited in APA format Instructor Feedback: This activity uses an integrated rubric in Blackboard. Students can view instructor feedback in the Grade Center. For more information, review these instructions. Critical Elements Factors: Statement Proficient (100%) Analyzes the income statement for any potential risk factors or compliance issues with GAAP or IFRS Factors: Sheet Analyzes risk factors and compliance issues with GAAP or IFRS on the balance sheet Factors: Control Analyzes the cash and revenue of the company for potential risk factors using the internal control Factors: Explain Explains the audit universe and how it was identified Factors: Devise Devises a sampling program for the audit universe based on the risk analysis Factors: Procedures Chooses an audit testing procedure that could be used and justifies why it would be preferable for this situation Articulation of Response Submission has no major errors related to citations, grammar, spelling, syntax, or organization Needs Improvement (75%) Analyzes the income statement for any potential risk factors or compliance issues with GAAP or IFRS, but analysis lacks depth or detail Analyzes risk factors and compliance issues with GAAP or IFRS the balance sheet, but analysis lacks depth or detail Analyzes the cash and revenue of the company for potential risk factors using the internal control, but analysis lacks depth or does not reference the internal control Explains the audit universe and how it was identified, but explanation lacks depth or detail Devises a sampling program for the audit universe based on the risk analysis, but the documentation of risk lacks depth or detail Chooses an audit testing procedure that could be used and justifies why it would be preferable, but justification is inaccurate or inappropriate Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas Not Evident (0%) Does not analyze the income statement for any potential risk factors or compliance issues with GAAP or IFRS Does not analyze risk factors and compliance issues with GAAP or IFRS on the balance sheet Value 16 Does not analyze the cash and revenue of the company for potential risk factors using the internal control 16 Does not explain the audit universe and how it was identified 16 Does not devise a sampling program for the audit universe based on the risk analysis 16 Does not choose an audit testing procedure that could be used nor justify why it would be preferable 16 Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas 4 Earned Total 16 100%