M3 Project - A large process risk for The Coca-Cola Company...

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A large process risk for The Coca-Cola Company is related to its work with research and innovation. Coca-Cola has pushed itself to the top by holding over 3500 beverage products. These were all maintained through either acquisition or new development. When assessing the risk of creating invaluable or unsuccessful products, one audit assertion that becomes the most concern to the financial statements is valuation. Placing an exact number on line items such as accounts receivable and intangible assets can become difficult when the value of a product is uncertain. However, through various control and procedural tests, auditors should be able to get as close to a correct value as possible. Examples of intangible assets include trade secrets, copyrights, patents, and customer lists. For Coca-Cola, their greatest trade secret is the Coca-Cola formula. Auditors should have the objective to properly value the intangible assets line item on the balance sheet. Currently, Coca-Cola should look to improve the controls which are set in place to monitor the intangible asset account. One option is for Coca-Cola to continuously research competition. By comparing
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This note was uploaded on 11/14/2011 for the course ACC 453 taught by Professor Grenier during the Spring '11 term at Miami University.

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M3 Project - A large process risk for The Coca-Cola Company...

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