Nature of the company Company Actions Audit Failures

100

What is 1-identifying trendy characters introduced to children in the United States by television programs, major movies, books, and other publications. 2-purchasing merchandise-licensing for those characters 3-marketing the merchandise to major retailers such as FAO Schwartz, Target, Toys "R" Us, etc.?
The business model of Happiness Express, Inc.

100

What is Budgie the little helicopter and Dudley the Dragon
Two characters the company relied on to replace their revenues from Power Ranger sales

100

What is the percentage of factored receivables
The auditors failed to recognize a significant change in this business practice

200

What is market research?
Reliance on this proved to be central to the company's early success

200

What is distorted fraudulent misrepresentations and insider trading
The class action lawsuit filed against Happiness Express the day after the September 1995 announcement charged Happiness Express and it's key officers with this.

200

What is unusually large increases in year-end sales to a single or a few customers?
An indicator of the risk of potential material misstatements in the financial statements

300

What is 75%
The percentage of revenue that Power Rangers produced for Happiness Express in 1995

300

What is sudden drop in sales of Mighty Morphin Power Rangers?
The primary source of the company's financial problems that had prompted the fraudulent scheme of concealment of the company's deteriorating financial condition was this.

300

What is 1-when examining invoices and bills of lading associated with Wow Wee sales 2-accounts receivable confirmations with Wow Wee 3-Failure to examine invoices associated with year end receivables from West Coast Liquidators?
3 instances where the auditors did not use due care in examining documentation

Happiness Express, Inc.

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