Pass Burden of Conducting Financial Audits to Financial Auditing Service Vendors

An audit is the procedure of gathering and assessing the facts by a capable independent individual with reference to quantifiable data of a particular financial establishment in order to verify and report upon the variations found between the information prepared and the recognized standards, if any. The application of this notion to the financial statements of the organization is referred to as financial auditing. GAAS stands for ‘Generally Accepted Auditing Standards’ and gives explanation of a list of formal and informal rules recognized as the basis for auditors to provide financial auditing services and getting their performance reviewed. These are comprised of laws, proclamations from professional or regulatory institutions, lawful verdicts in cases relating to auditors. Every country sets these principles for itself.

The report prepared by the auditors, popularly known as audit report, comprises of their views regarding statements, the outcome of their concern on internal controls and conclusions on the assessment of the information in relation to compliance with the established criteria. They are required to be devised as per the General Accepted Accounting Principles (GAAP).So, an auditor tests that whether the on the whole, the financial statements are presented according to the set GAAP. Auditors, also comprehend the efficiency existing internal controls in the entity and suggest measures, if required, for the improving the effectiveness of these internal controls. The auditors will carry out an analysis to establish conformity of financial statements with the rules and regulations .In addition, the auditors will discuss with the management on the subjects of the ways of preparation of accounting information and evaluate this information for reliability through management’s reactions in the discussions, statements which have been audited, and other facts obtained during the inspection of the financial statements.

For the owner of a business in UK, it is complicated and a lengthy process to get financial audit done through its own staff. It would also prove to be an expensive process as well as the owner would still be worried as employees of the business may not be specialized in this area. Thus, in today’s corporate scenario, most of the businesses engage the firms which are expert in rendering financial audit which include financial auditing services and wish good bye to the auditing troubles.

Author of this article is an internal auditor of a well-known entity and offers quality best financial auditing to that entity.

Obama supporters why do you blame the Republicans for the financial situation when it was the Democrats who ?

Query by Green Eyed Gila: Obama supporters why do you blame the Republicans for the financial situation when it was the Democrats who ?
voted against legislation in 2005 that would have prevented some of the mess we see right now?
“I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for fast passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the huge threat that Fannie Mae and Freddie Mac pose to the housing market place, the all round financial program, and the economy as a complete.”

(A bill that attempted to fix the fiasco signed into legislation in 1992)

And do the folks who took out mortgages for loans they could not afford also not bare any responsibility?
Ten Points to the first Democrat that tells me which Republican said the above quote.

Ideal answer:

Answer by John McCain
You tell em boy! Like I said, the fundamentals of the Economy is robust! I’ve got 7 property to prove it!

Ohhhhh Ciiiiiiiiiindy… Will ya bring me the Ben-Gay please. I’ve got an ache in my shoulder that is hurtin like a son of a B*&%$ @!

Give your answer to this query below!

What is your solution for the financial crisis?

Query by Irascible Interlocutor: What is your solution for the monetary crisis?
Is the bailout the very best way to go?
Perhaps we should just let the banks fail?
Ought to the government get up toxic assets or banking stocks? Ought to Wall Street be bailed out or the homeowner who is facing foreclosure?

Sen. Chuck Schumer of N.Y. who is on the banking committee, and a single of the 1st officials to push for a bailout mentioned that New York ought to get their fair share of the bailout income the Government is disbursing.

I consider that New York financial center and Senator Schumer (NY) are responsible for the monetary crisis in the very first spot and that New York must Pay far more than it really is fair share, NOT receive its fair share.

Who do you feel need to pay?

The link is a really good write-up about Sen. Schumer and his involvement in the financial crisis.
Musicman, I don’t understand your answer. You begin by saying the banks cannot fail, and finish by saying no bailout for banks.

Very best answer:

Answer by Musicman812
You can’t let the banks fail. Everyone’s screaming about the government carrying out everything for wall st. and absolutely nothing for primary st.. I beg to differ, if the banks fail, so do consumers’ accounts — whoops, did we all fail to make that connection?

Loans/savings/CD’s/MMA’s/and so on. etc….gone in a flash.

you said:
“I think that New York monetary center and Senator Schumer (NY) are accountable for the financial crisis in the very first place and that New York should Spend more than it’s fair share, NOT get its fair share.”

You are only partially right. Without government mandated policies which permitted for securitization of these toxic loans, it wouldn’t have considerably of a difficulty. You see, the government opened a market to the totally free-market place banks to take toxic loans off of their books in an effort to get them to make much more loans — The Community Reinvestment Act.

With out that market place to sell these loans, free-marketplace banks would’ve kept those loans on the books — and used a small much more discretion when creating loans.

Who’s to blame? (Crappy) Government policy — greed in the free-industry banking industry — greed in shoppers who wanted it but could not afford it. A lot to go around.

As for state’s obtaining Federal funds — if Obama had a spine he’s look them all in the eye and inform them to reduce spending…and use discretionary funds. If they can’t make it — as well f*cking undesirable…lessons discovered the difficult approaches are those that stick around.

No bailout, no bailout, no bailout.

Cease throwing part of my cash at the wall!!
Edit: No bailout — “stimulus” package. Obama is advertising and marketing it as the only way we’ll accelerate growth in the economy. He’s going to bailout the U.S. citizen by taking care of the economy. The issue is not plugging the hole any longer…money or not, individuals are going to save — they won’t commit. The problem we need to address is providing citizens the self-confidence to devote again. With no that, we’ll prolong the problem…because the “stimulus” only performs until the income runs out. After the 1 trillion is gone, if you do not have buyers to step up to the plate to devote, we’ll spiral proper back into a ten+% unemployment price. A waste of money if you ask me.

And banks as big as BofA and Citi can’t fail…their financing ripples all through the economy (not to mention the citizenry) — but the government can surely bail them out w/ far more efficiency. Watching BofA acquire Merrill Lynch w/ taxpayer funds only to deepen their debt and ask for far more taxpayer money (and get it!) doesn’t sit properly with me. Very good operate Frank/Dodd/Paulson! Bang up job.

Sorry for the confusion. )

Give your answer to this question below!

Why are the Liberals not however know that Barney Frank and the Democrats / Fannie Mae has brought on this financial disaster?

issue of the original Bob Enzyte : Why are the Liberals not but know that Barney Frank and the Democrats / Fannie Mae has brought on this financial disaster FANNIE MAE AND DEMOCRATS IN THEIR Personal WORDS: Ideal answer:

response Sunshine
Since our dollar was almost quickly devalued the Bush initial took loans from China several years ago minute, I feel it has more to do with that.

Give your answer to this question beneath!

Since The Financial Mess Was Produced By Obama And Other Democrat Politicians, Need to They Give Up..?

Query by a bush household member: Considering that The Financial Mess Was Created By Obama And Other Democrat Politicians, Must They Give Up..?
their salaries, and function for cost-free? Like the way they want automakers’ CEOs to do?
1) The final Democrat president designed the housing bubble which is now collapsing. (non biased U.S. Federal Reserve web site)
2) Democrats triggered the housing bubble to collapse by lowering customer confidence (adverse campaigning) and by encouraging home builders to overbuild by employing illegal immgrant labor to generate 100% to 400% earnings. ( Democrats blocked huge efforts created by President Bush to fine employers of illegal immigrants.)
3) Clinton ignored a government report that stated bank derivatives had been dangerous to the economy. He also threatened to fine banks that had been not giving loans to poor individuals.
4) Clinton, ACORN, OBama, and Rubin pushed for changing laws to offer a lot more risky loans.
6) Obama and other Democrats voted for weak border handle which decreases wages, increases joblessness, lowers the normal of living, etc.
7) Democrats blocked President Bush’s GSE reform (Fannie Mae and Freddie Mac reform) by filibustering in congress..
8) $ 700 billion was spent to repair Clinton’s bank derivatives issue.
9) Democrats elevated our dependence on foreign oil. That increases gas bills, hurt the economy, decreased national security, and is providing other countries hundreds of billions of dollars yearly. Also, it als financially aids numerous countries which do not have our best interests in mind.
Because 2001, President Bush warned of the issue and put forward plans to fix Fannie Mae and Freddie Mac:
In 2003, “Spurred by worries that Fannie and Freddie had been cooking their books and taking as well many risks, Treasury Secretary John Snow proposed putting the businesses beneath Treasury oversight with strict controls more than threat and capital reserves. The NYT labeled the proposal “the most substantial regulatory overhaul in the housing finance business because the savings and loan crisis a decade ago””
In 1997 Clinton “actively sponsored ” risky home loans :
“”…speedy development in affordable-loan programs and subprime lending…”
“The development in these [specific loan] programs has been actively sponsored by the Clinton administration ”
“The presently robust housing industry is due in part to the initiation of a wide assortment of cost-effective home-loan programs. These programs are intended to advantage low-earnings and minority households and neighborhoods by way of much more versatile underwriting policies. These policies consist of low-downpayment specifications, larger acceptable ratios of debt payment to revenue, the use of option credit history information such as records of payments for rent and utilities, versatile employment standards, and decreased cash reserve needs. The development in these programs has been actively sponsored by the *** Clinton administration *** in a concerted effort to raise home-ownership rates.”
Mortgage Banking [News] – Aug 1, 1997
One particular of Clinton’s Freddie Mac changes:
“Freddie Mac, one particular of the primary government-sponsored enterprises involved in the obtain of mortgages, not too long ago announced plans to enter the secondary marketplace in subprime loans by purchasing substantial numbers of “A minus” subprime mortgages by 1998 and the higher-threat “B and C” loans by 1999.(20) ”

1 of Clinton’s modifications to foreclosure insurance coverage ( that protected banks ).
“On June 6, 1996, President Clinton announced that he had directed FHA to decrease the up-front mortgage insurance premium (UFMIP) for 1st-time homebuyers who obtain housing counseling”
Democrats’ response to President Bush’s reform of Fannie Mae And Freddie Mac.
“These two entities—Fannie Mae and Freddie Mac—are not facing any kind of monetary crisis,” mentioned Representative Barney Frank of Massachusetts, the ranking Democrat on the Economic Services Committee. “The much more men and women exaggerate these troubles, the much more stress there is on these companies, the much less we will see in terms of affordable housing.”
Democrat Barney Frank: In April 2004, Fannie announced a multibillion-dollar financial “misstatement” of its own. Mr. Frank was back for the defense. Fannie and Freddie posed no danger to taxpayers, [ Barney Frank ] said, adding that “I consider Wall Street will get over it” if the two collapsed. Yes, they are undoubtedly “over it” on the Street now that Uncle Sam is guaranteeing their Fannie paper, and even Fannie’s subordinated debt.
[ Democrat Barney] “Frank was publicly arguing for an increase in the size of their combined $ 1.4 trillion portfolios right up to the day they had been bailed out. Even now, following he’s been proven wrong about a taxpayer guarantee, he opposes Treasury’s planned reduction in the size of the portfolios starting in 2010, according to a quote attributed to him in this newspaper last week. “Great luck on that,” he reportedly said. Mr. Frank’s spokeswoman hung up the phone when we sought confirmation Tuesday” … “For years, Mr. Frank and other pals of Fan and Fred opposed not only bills written to limit the size of their portfolios”
Wall Street Journal.

Ideal answer:

Answer by how is babby formed
Do they want the CEOs to function for cost-free or do they want them to give up their private jets?

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Q&A: what trigger the current financial collapse in globe. 2008?

Query by redryan: what trigger the current economic collapse in globe. 2008?
And I like to know why the rest of the globe blames the U.S for this what truly happened? Why did it take place?

Greatest answer:

Answer by S D
Men and women buying more than they could afford using adjustable rate mortgages. Making use of houses as an ATM. Credit card debt. Flipping homes Generally men and women living way beyond their means when you make $ 5.00 an hour you cannot afford a $ 500,000.00 house along with a new bmw or mercedes Some will say it is all the bankers fault but the people signed their life away and bit off far more than they could chew.

Give your answer to this query beneath!

What is the cause of our financial problems?

Question by American citizen and taxpayer: What is the lead to of our financial problems?
And what (if something) should the government do to combat the problems?
One more question:

Ideal answer:

Answer by OGCJM
Element of it is the illegal immigration problem. There are millions more than here mooching off of U.S. tax paying citizens it is horrible. They are bleeding California dry proper along with hospitals, public schools and the tax payers wallets! They should be deported when found, our borders secured (which they ought to have been ever since 9/11), enforce our immigration laws, jail/fine anyone that employ illegals, take away every freebie they get, and so forth.

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Q&A: Best Topic for Master’s Thesis in Financial Investment?

Question by Leon T: Best Topic for Master’s Thesis in Financial Investment?
Allright, this is a very important question to all the guys tell me what will be a best topic for my Thesis in Investments, I am in Sweden and I want to get a job here, moreover I am interested in Banking and Tax but let me know what ideas you guys have, I mean latest issues on wich my Thesis work will be a raod to new creation, Something different and new, I wanna know which is hot issue of today in Investments.
I Will be thankful to you guys.

Best answer:

Answer by marmalade
Given the topics of the last few weeks:-

1) what lessons for the structuring of securitization transactions can be drawn from the sub-prime mortgage crisis of 2007-8?

2) to what extent does the rouge trader (traders hiding trading losses and accumulating massive losses) problem manifest a failure of management within private sector financial institutions or a failure of public sector regulation of them?

3) should politicians be allowed to join private sector financial institutions within a specific period of retirement from public office? (UK:- Tony B)

4) to what extent are hedge funds beneficial to the economy in which they operate?

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Q&A: Did Socialism or Capitalism bring about America’s current financial demise?

Question by Water_Resources: Did Socialism or Capitalism bring about America’s current financial demise?

Informed answers appreciated.
Demise; the end of something that used to exist, especially when it happens slowly and predictably.

Best answer:

Answer by birdie
Cute question! I will sit back and enjoy the show!

Give your answer to this question below!

what is the cause of lehman brother’s financial trouble?

Question by Lauren L: what is the cause of lehman brother’s financial trouble?
what decisions did Lehman Brothers, Bear Stearn’s and Merrill Lynch make that led them to financial trouble?

Best answer:

Answer by HJ Bear
Somewhat applicable to the industry as a whole
1) thin capital base to start
2) investments in alt-a mortgage loans and commercial real estate soured. in better times, they made good money buying assets and reselling for a profit; but the music stopped. they were also “hung” with a lot of bad corporate bridge loans.
3) financed themselves very aggressively with repo loans from other financial institutions which could get called quickly
4) the investment banks attempted to hedge some of their sub-prime and securitization risk with third parties (such as MBIA, SCA) who lost their AAA credit rating due to sub-prime crisis
5) underwriting profits came to a halt

More specific to Lehman
6) they did not raise capital (dilutive to current shareholders) and tried to ride out storm. Even when they were close to the abyss, they were high-handed when the Korean Development Bank was considering an investment
7) they lost credibility because they were seen hiding the ball
8) short sellers may have exacerbated the perceptual issues. the ban on certain types of short selling had been lifted a week before they blew up.
9)The recent conservatorship of FNMA and Freddie may have destabilized access to funding. The form of rescue by the Treasury inadvertently chilled the potential for other financial institutions to tap the equity markets
10) The US Treasury Dept and Fed Reserve, stung by criticism about their handling of Bear Stearns, took a tough line on aiding Lehman. Their desire to administer tough love to the capital markets backfired when none of the rescuers stepped up to the plate.

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Q&A: What are various methods of financial restructuring?

Question by freind2all: What are various methods of financial restructuring?
Please provide answer with details.. thanx

Best answer:

Answer by chipolte
summer because it is hot
winter because it is cold
fall because it is breezy
spring because it is warm

over and over and over until it ends

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Q&A: a package of nontraded financial instruments can be transformed into a traded financial instrument through the

Question by sweetie pie: a package of nontraded financial instruments can be transformed into a traded financial instrument through the
process of?

a. collateralization
b. repurchasing
c. underwriting
d. securitization

Best answer:

Answer by MuaRung
d. securitization.

Securitization is the process of homogenizing and packaging financial instruments into a new fungible one. (Fungible means being of such nature or kind as to be freely exchangeable or replaceable, in whole or in part, for another of like nature or kind.)

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what does “tranches” mean in a financial environment ?

Question by Noble Athavan: what does “tranches” mean in a financial environment ?
ex:- tranches in securitization

Best answer:

Answer by j
A piece, portion or slice of a deal or structured financing. This portion is one of several related securities that are offered at the same time but have different risks, rewards and/or maturities.

Tranche is a term often used to describe a specific class of bonds within an offering wherein each tranche offers varying degrees of risk to the investor. For example, a CMO offering a partitioned MBS portfolio might have mortgages (tranches) that have one-year, two- year, five-year and 20-year maturities. It can also refer to segments that are offered domestically and internationally.

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The Ascent of Money: A Financial History of The World by Niall Ferguson Epsd. 1-5 (Full Documentary)

Niall Ferguson follows the money to tell the human story behind the evolution of finance, from its origins in ancient Mesopotamia to the latest upheavals on …
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Q&A: What will financial form mean for the mortgage analytics industry?

Question by : What will financial form mean for the mortgage analytics industry?

Best answer:

Answer by Jim
According to mortgage analytics firm Heitman Analytics…who knows? But it’s fun to read up on others’ projections. Read the full post at

Finance forecasts and projections abound with financial reform now right around the corner. It’s all white noise, of course, until the chips begin to fall. But one thing is for sure: it’s bound to shake up the way we all approach mortgage analytics. And this industry has certainly seen its share of changes in the last couple years. But while we’re not putting too much stock in all the prognoses circulating the web, we do think it’s important to stay tuned in. Here are a couple we’ve been paying attention to lately…

…and The Huffington Post has these thoughts about how the impending bill will impact the mortgage industry in particular:

The Bill is Jet Fuel for Concentration of Mortgage Risk: One of the likely outcomes of the bill is that the largest financial institutions will increase their already bloated share of the mortgage market. Five banks today control in excess of 65% of the mortgage market — the financial bill will accelerate this trend by favoring banks over independent lenders. This was a deliberate decision pushed by Chairman Frank and the administration on the theory that large banks were easier to regulate than myriad independent lenders. Thus risk retention requirements, compensation rules, and licensing standards are all tilted toward large banks. The result is that the big will get bigger — and the level of mortgage risk will concentrate further — though the administration argues that more competent regulators and safer mortgage products alleviate the concern about “too bigger to fail”.

Indefinite and Increased Government Support for Mortgage Market: The bill further increases the dependence of the mortgage and housing market on federal support. Private capital is already scarce in housing — over 95% of mortgages today are guaranteed directly or indirectly by FHA and other government agencies. Private securitizations will be helped by new rules that create transparency and requirements that rating agencies do their homework before rating a mortgage security. But other parts of the bill impose new liability on securitizers for the underlying mortgages originated by third parties, and requirements to retain capital when transferring risk. The full contours of these rules won’t be issued by regulators for 2-3 years — extending a period of uncertainty that has dissuaded private investors from restarting the flow of mortgage capital. Meanwhile, the federal footprint in mortgages will become deeper and deeper in order to keep the housing market from the dreaded double dip — and making the unwinding of federal intervention that much more difficult.

A Smaller Mortgage Market With Fewer Qualified Borrowers: The new law places significant hurdles to offering any mortgage products outside the “plain vanilla” category. Regulators must define what is inside or outside the plain-vanilla box. Clearly, firm regulation of mortgage products is necessary in light of the subprime meltdown. But exactly where regulators draw the line will have a substantial impact on what kind of mortgages are available and which borrowers will qualify for a mortgage. Already we have seen that non-traditional borrowers have virtually fallen out of the home-buying market, other than thru government guaranteed FHA loans. Last year, rejection rates for African American and Latino borrowers skyrocketed for non-FHA loans. Will new mortgage standards be flexible enough to allow for reasonable credit risk determinations — or will plain vanilla mortgages mean plain vanilla homeowners?

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True or False? Securitizations of financial claims and securities such as mortgages have reduced the risk?

Question by answerman: True or False? Securitizations of financial claims and securities such as mortgages have reduced the risk?
facing international investors.

Best answer:

Answer by meg
That is what the wall street bank believed and the credit rating agencies agreed. They thought by packaging mortgages from different regions of the country they could reduce the standard deviation in the return , and that is how risk is measured in finance. They assumed that each real estate market was and independent, that is the price movements in Florida and California were not correlated, What was missing from the calculations was the catastrophic loses that would result if home price fell in all markets at the same time, one outlier like that can cause a big increase the standard deviation even if it has a small probably.

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