ACC 340
Final Exam
Essay questions
1. Discuss at length at least four things you could do to help shorten the close
process as a new controller.
The existing closure procedure must be documented before a new controller can attempt to
minimize the time it takes to close. Following this stage, a controller may decide to change
the timing of closure activities, optimize the use of journal entries, or make particular
enhancements to specific operational areas.
It is critical to document the present close procedure in order to achieve a quick closure. It is
necessary to document all functional areas of the close, including accounts payable,
accounts receivable, cash and inventory, the general ledger, and the compilation of the
financial statements. By bringing together the documentation of all of the closing procedures,
it will be possible to get a complete view of how long each task takes and what might be
causing bottlenecks in the process.
The existing close process can be recorded, and once that is done, a new controller can
change the time of the closing actions. Consider the following scenario: rather than waiting
for the bank statement to be generated at the end of the month, an accountant may process
cash transactions on a weekly basis. This would shorten the amount of time required to
execute a key step throughout the closing process. The usage of journal entries can be
made more efficient, which can help to speed up the closing process. For example, with the
accounting system you are now using, repeating monthly or quarterly journal entries could
potentially be automated. Alternatively, you may have entered earlier in the month. Making
specific enhancements in functional areas can result in significant increases in the speed
with which a closing is completed. One example would be the implementation of a more
efficient billing system. A more recent system may allow for the generation of bills, the direct
emailing of bills to clients, and the collection of bill payments by electronic means. Upgrades
to accounting systems can make it much easier for accountants to carry out their day-to-day
responsibilities, which should result in a faster closing process.
2. Name at least two documents a public company would be required to file under the
SEC.%% How often must they be file? Describe what they are and what information
they would provide to the public.
Form 8-K, as well as Forms 10-K and 10-Q, are the two documents that a public corporation
is required to submit with the SEC. Form 8-K must be completed in order to report
substantial, previously unknown events. As an illustration, consider a corporation that
declares bankruptcy. These forms must be submitted no later than four business days after
