Chapter 5: Internal Control over Financial Reporting 1. Internal control is a process designed to guarantee the achievement of the objectives of reliable financial reporting‚ compliance with laws and regulations and ineffective and inefficient operations. FALSE 2. Auditing standards require that the auditor exercise professional judgment and maintain professional skepticism throughout the planning and performance of the audit. TRUE 3. If internal controls are not enforced they are useless
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COMPANY PROFILE-PEPSI CO. (US) PepsiCo is a world leader in convenient foods and beverages‚ with revenues of about $27 billion and over 143‚000 employees. The company consists of the snack business of Frito-Lay North America and the beverage and food businesses of PepsiCo Beverages and Foods‚ which includes PepsiCo Beverages North America (Pepsi-Cola North America and Gatorade/Tropicana North America) and Quaker Foods North America. PepsiCo International includes the snack businesses of Frito-Lay
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Internal Controls XACC/280 April 7‚2013 Axia Internal Controls Internal controls are put into place to safeguard a company’s assets and to promote the accuracy of their accounting records. There are two primary goals of internal controls. The first goal of internal controls is to safeguard it’s assets from employee theft‚ robbery‚ or unauthorized use. When there is a large some of money there is temptation from employee’s to take some of it. Many employees believe they are underpaid
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Strength Pepsi has a broader product line and outstanding reputation. Merger of Quaker Oats produced synergy across the board. Record revenues and increasing market share. Lack of capital constraints (availability of large free cash flow). o Great brands‚ strong distribution‚ innovative capabilities o Number one maker of snacks‚ such as corn chips and potato chips PepsiCo sells three products through the same distribution channel. For example‚ combining the production capabilities
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Inventory Internal Controls ________________________________________ A company’s investment in inventory is usually a large one‚ and it may be comprised of a large number of merchandise items that can be readily stolen and resold. If the inventory contains mostly raw materials‚ then keeping track of it is essential for ensuring that the production processes using it will not run short of materials. This means that you need to implement an array of controls‚ either to prevent theft or to ensure
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Internal Control Definition Internal control is broadly defined as a process‚ effected by an entity’s board of trustees‚ management‚ and other personnel‚ designed to provide reasonable assurance regarding the achievement of objectives in the following categories: 1. Effectiveness and efficiency of operations 2. Reliability of financial reporting 3. Compliance with applicable laws and regulations 4. Safeguarding of assets Internal control consists of five interrelated components:
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Background Established in 1965 PepsiCo created in 1965 through the merger of Pepsi-Cola and Frito-Lay In 1997‚ publicly traded company to focus PepsiCo on food and beverages. The world’s largest snack and beverage company in 2006 In 2006‚ PepsiCo has approximately $35billion net revenue The company is broken into four business divisions: ◦ Frito-lay North America Frito-Lay North America manufactures‚ markets‚ sells and distributes salty and sweet snacks. Products manufactured and
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UNDERSTANDING INTERNAL CONTROLS A Reference Guide for Managing University Business Practices Understanding Internal Controls Table of Contents INTRODUCTION .................................................................................................................................................................1 OBJECTIVES ......................................................................................................................................................................1
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Case Study 2 – Internal Control TO: LJB Company President FROM: Andrea Johnson DATE: February 8‚ 2013 SUBJECT: Internal Control It is with great pleasure that we can provide you information and advisement on internal controls that will assist LJB Company with going public. We understand that you have communicated your concerns and expect that this report will assist you with deriving conclusions. This report will: 1. Inform you of any new internal control requirements in reference to
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Internal Controls XACC/280 Whenever having a company‚ he or she must have the right aspects so that business can run as smoothly as possible. The existence where not having the company together as supposed to‚ then there are problems that can follow. Internal control is the safeguard of the assets and the accuracy along with able to rely on he or she’s accounting records and the guide to success is making sure that he or she follows the control principles. The two sentences before this is the
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