The New York Stock Exchange (NYSE) and the National Association of Securities Dealers (NASD) require that listed
Question:
1. What are the key business and financial risks the company has to deal with in its financial reporting?
2. What financial reporting areas involved subjective judgments or estimates, and how are those judgments made and estimates determined?
3. Are there significant areas where the company’s accounting policies were difficult to determine?
4. How do the company’s accounting practices compare with those of others in the industry?
5. Are the financial statements and underlying accounting methods consistent with those used last year?
6. Are alternative accounting practices being proposed or considered that should be brought to the committee’s attention?
7. Were there serious problems in preparing the financial statements?
8. Have outside parties including the SEC, major investors, analysts, and the news media voiced concern about the company’s accounting practices?
9. Were there disagreements between management and the auditor regarding accounting practices and, if so, how were they resolved?
Source: Audit Committee Update 2000, PricewaterhouseCoopers LLP.
Required:
Explain for each question why the audit committee and investors might be interested in the answer.
Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
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Related Book For
Financial Reporting and Analysis
ISBN: 978-0078025679
6th edition
Authors: Flawrence Revsine, Daniel Collins, Bruce, Mittelstaedt, Leon
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