Case Study: Majestic Hotels, Inc.

Using Analytical Procedures as Substantive Tests
By Frank A. Buckless and D. Scott Showalter, NC State University Appendix A — Sleeping Room Revenue Work Paper Template

Brickman & Joyner, CPAs

Room Revenue Analytical

Client

Period-end

Majestic Hotels, Inc.

December 31, 2011

Prepared by

Date

W/P reference

R-10

Purpose
To obtain sufficient appropriate audit evidence that sleeping room revenues exist, are complete, and are accurate.

Procedures
To test the reasonableness of sleeping room revenues, B&J:

1. Identified the key factors, key relationships and other considerations that drive sleeping room revenues
2. Determined tolerable misstatement based on assessment of inherent and internal control risks
3. Set and corroborated expectations
4. Compared client actual amounts to expectations and evaluated results 5. Assessed the need for additional tests of details

Results & Conclusion
1. Identify key factors, key relationships and other considerations that drive sleeping room revenues:

Key Factors
(drivers)

Key Relationships

(ratios that tie key factors to FS captions)

Other Considerations

(objectives, strategies, and external
factors that impact key relationships)

© 2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. © 2012 Frank A. Buckless and D. Scott Showalter

Case Study: Majestic Hotels, Inc.

Using Analytical Procedures as Substantive Tests
By Frank A. Buckless and D. Scott Showalter, NC State University Appendix A — Sleeping Room Revenue Work Paper Template

2. Determine tolerable misstatement based on inherent and control risk assessments

3. Set and corroborate expectations

4. Compare client actual amounts to expectations and evaluate results

5. Assess the need for additional tests of details

Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.