Dit report fiaancial statements for each publicly

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dit Report Fiaancial statements for each publicly traded company must be audited by an independent audit firm. There are a ber of large auditing firms that are authorized by the SEC to provide auditing services for companies that issue securities to the public: PricewaterhouseCoopers, KPMG, Ernst & Young, Oeloitte, RSM McGladrey, ntThornton, and BOO Seidman, to name a few.These firms provide opinions about financial statements for large majority of publicly traded U.S. companies. A company's Board of Directors hires the auditors to review express an opinion on its financial statements. The audit opinion expressed by Deloitte & Touche, LLP, on the :ina.ncial statements of Berkshire Hathaway is reproduced in Exhibit 1.1 O. The basic "clean" audit report is consistent across companies and includes these assertions: Financial statements are management's responsibility. Auditor responsibility is to express an opinion on those statements. Auditing involves a sampling of transactions, not investigation of each transaction. Audit opinion provides reasonable assurance that the statements are free of material misstatements, not a guarantee. Auditors review accounting policies used by management and the estimates used in preparing the statements. Financial statements present fairly, in all material respects a company's financial condition, in conformity with GAAP. : the auditor cannot make all of these assertions, the auditor cannot issue a clean opinion. Instead, the auditor is- s a "qualified" opinion and states the reasons a clean opinion cannot be issued. Financial report readers should scrutinize with care both the qualified audit opinion and the financial statements themselves. The audit opinion is not based on a test of each transaction. Instead, auditors usually develop statistical samples make inferences about the larger set of transactions. The audit report is not a guarantee that no misstatements exist. Auditors only provide reasonable assurance that the statements are free of material misstatements. Their use - the word "reasonable" is deliberate, as they do not want to be held to an absolute standard should problems be
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1-29 Module 1 I Framework for Analysis and Valuation _ Audit Report for Berkshire Hathaway To the Board of Directors and Shareholders of Berkshire Hathaway Inc. We have audited the accompanying consolidated balance sheets of Berkshire Hathaway Inc. and subsidiaries (the "Company") as of December 31, 2010 and 2009, and the related consolidated statements of earnings, cash flows and changes in shareholders' equity and comprehensive income for each of the three years in the period ended December 31, 2010. We also have audited the Company's internal control over financial reporting as of December 31,2010, based on criteria established in Internal Control- Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.
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