SC has improved it overall standing when compared to 2015 ratios but there are certainly areas of weakness that will need to be reviewed and revised in order to insure a continual increase instead of a declined or standstill over the years of operation.Internal Control Processes are set within the generally accepted accounting principles, also known as GAAP, by the Financial Accounting Standard’s Board for companies that operate inside the United States. There are five key steps to ensure internal controls are intact. The steps are listed as follows; segregation of duties, access, authorization, record keeping, and verification. “Internal controls are designed to prevent fraud and clerical errors that may compromise the accuracy of a company's financial statements. Solid internal controls can also reduce losses from theft of company assets and identify underperforming employees (Sullivan).”
Starbucks Corporation Financial Analysis 8According to the 10-K filed by Starbucks in 2016 the following measures were taken. “Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; providing reasonable assurance that receipts and expenditures are made in accordance with management authorization; and providingreasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected. Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework and criteria established in Internal Control — Integrated Framework (the "2013 Framework"), issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, management concluded that our internal control over financial reporting was effective as of October 2, 2016 (Starbucks Fiscal 2016 Annual Report 2016).”
Starbucks Corporation Financial Analysis 9This shows that Starbucks has taken the appropriate steps to ensure that their reporting is
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- Winter '15