ch01 - CHAPTER 1 FINANCIAL ACCOUNTING IN AN ECONOMIC...

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CHAPTER 1 FINANCIAL ACCOUNTING IN AN ECONOMIC CONTEXT ISSUES FOR DISCUSSION ID1–3 The function of the audit committee is to provide a channel whereby the auditors report their findings and concerns, if any, to the board of directors. Typically there are outside members of the board that are on the audit committee so that if the auditors have concerns about management’s financial statements or activities, then the auditors have a way to speak directly to the board of directors. The auditors are in a sensitive position because the financial statements and activities that they are auditing are prepared by the same people who hire and pay the auditors. Therefore, they may be reluctant to jeopardize their relationship with the company by being too negative. ID1-12 a. Pepsico is a large manufacturing company, producing soft drinks and syrup to be sold to other soft drink bottling companies. The company also manufactures a variety of snack products, such as potato chips and pretzels; products are sold to retailers, who ultimately
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This note was uploaded on 09/06/2010 for the course BUSINESS ACG 6025 taught by Professor Karenlivingstone during the Fall '10 term at University of South Florida - Tampa.

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ch01 - CHAPTER 1 FINANCIAL ACCOUNTING IN AN ECONOMIC...

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