Question:
Evaluate an annual report of a publicly held corporation of your selection on the internet (not the General Electric annual report).
Read the auditor's reports on internal controls and on the financial statements.
Report the following:
The name of the corporation whose report you examined.
The internet address where the information was found.
The name of the audit firm performing the audit.
Note whether the reports on the financial statements and internal controls were combined in one report or separated into two reports.
The type of report issued on the financial statements (unqualified, qualified, adverse, or disclaimer).
The type of report issued on the internal controls (unqualified, adverse, or disclaimer).
For reports getting unqualified opinions note any deviations from the standard unqualified audit report (such as a change in auditors, changes in accounting principles, a change in the reporting entity, a going concern issue, and/or other explanatory paragraphs).
Each of the given seven items have to be reported to receive full credit on this discussion assignment. Note that it is very unlikely that you will evaluate reports containing qualified opinions, adverse opinions, or disclaimers of opinion on the financial statements. Occasionally you can find an adverse opinion or disclaimer of opinion on the report on internal controls.
Next, show the audit reports you found. Here are some suggested questions to help get you started:
Why do virtually all publicly held corporations get an unqualified audit opinion on their financial statements?
Why are corporations willing to pay significant amounts for an independent audit? What are the advantages?
Did the audit reports look like the examples in the textbook? What was different?
Did you learn anything new by finding and reading the audit report?