RESEARCH PAPER ASSIGNMENT
PAPER INFORMATION:
You will be looking at Pepsico Inc and Coca Cola Co for the fiscal year ended 2015 and completing a variety of analysis on both of these companies. You will specifically be using:
o Pepsico Inc 2015 annual report
o Pepsico Inc 2015 10-K
o Pepsico Inc 2015 Def 14A
o CocaCola Co 2015 annual report
o CocaCola Co 2015 2015 10-K
o CocaCola Co 2015 Def 14A
ANALYSIS REQUIREMENTS:
Part II.
i. Consider the inventory accounts on the balance sheet for each company, along with the accompanying footnote. What are the most relevant assertions that management is making with regard to its inventory?
iii. What assertions are implied in the Property, Plant, and Equipment account? How would valuation be affected if each company decided to downsize and eliminate some of its storefront locations?
iii. Examine the assets on the balance sheet of each company. Identify the assets that are subject to (a) fair value adjustments, (b) impairment tests, (c) estimates to either net realizable value or lower of cost or market value. What are the implications for audit evidence that will be gathered for these accounts?
iv. Consider the debt account on each balance sheet, along with the accompanying footnote. What are the most relevant assertions that management is making with regard to its debt?
v. Describe the primary risks facing PepsiCo. Describe the primary risks facing CocaCola. Compare the risks of PepsiCo and CocaCola. Why would an auditor be concerned with these risks?
vi. What are the key revenue accounts for PepsiCo and CocaCola? What accounts involve critical accounting estimates? What do their footnotes say about the use of accounting estimates? What risk do these estimates pose for the auditor?
vii. What are the key cash and liquid asset accounts for each company? What types of marketable securities do each company possess? What are the critical accounting policies for these accounts?
viii. Review the statement of cash flows and management discussion and analysis related to the liquidity of each company. What are the significant trends that you note? What are the audit implications of the different trends of each company?
Format your assignment according to the give formatting requirements:
1. The answer must be double spaced, typed, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the assignment, the course title, the student's name, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.