The primary purpose of this case is to help you become familiar with the content of filings that public companies (“Registrants”) make with the Securities and Exchange Commission. As a public accountant you’ll need to be very well versed in all accounting and auditing matters since in the eyes of the SEC, the independent registered public accounting firm is considered “Expert” in accounting and auditing.
Please select a well-known company and/or a company included in the Standard and Poor’s 500 index of some of the 500 largest companies ( such as colgate Palmolive, Apple, Amazon, Walmart , Target…etc). To successfully complete this case you will need to search for your selected company’s filings at www.sec.gov and analyze the most recently filed Annual Report – Form 10 K and the Proxy Statement – Form DEF 14A. In preparing your case please include the exact source of the information for each question. (For example – Form 10 K, Item 1, page #).
1. Briefly describe the company, the location of its corporate headquarters, its business, and at least three risk factors along with their possible impact on the Company if it does not successfully manage these risks. Why would auditors want to know about their clients’ business-related risks?
2. Describe The Company’s audit committee and its duties. Review the audit committee’s report and describe its primary concerns. Who is the designated financial expert on the audit committee? Does the designation as only one individual as a financial expert seem adequate for the complexity of The Company and the requirements of the Sarbanes-Oxley Act? Please explain.
3. Who is the auditor for The Company? What were the fees charged for audit services for each of the last two fiscal years ? What were the type and amounts of other fees for services for each of the last two fiscal years? Do you believe the non-audit services provided by the auditor might compromise their independence, or perception of independence? Why?
4. The Sarbanes-Oxley Act of 2002 requires principal executive officers of publicly traded companies to sign certain certifications in the annual report and also in the quarterly reports. Name each certification report in the annual report (hint – this might be a separate exhibit under the 10-K filing). What is the name and title of the executive officer who signed each of the certification reports? Why do you think Congress felt that it was necessary to require executive officers to sign such certifications?
. The assessment will be based on:
Specifically & clearly address the questions asked in the assignment including summary of key facts –
Critical thinking – it is important to develop an ability to read information and determine how auditing concepts apply
