CVS Corporation is a leader in the retail drugstore industry in the United States, with net sales of $30.6 billion in fiscal 2004. As of January 1, 2005, CVS operated over 5,375 retail and specialty pharmacy stores in 36 states and the District of Columbia.
Using the Internet, access the CVS January 1, 2005 10-K filing with the Securities and Exchange Commission. You can use the PricewaterhouseCoopers Web site, https://edgarscan.pwcglobal.com, to search for company filings by name. Based upon the 10-K filing, answer the following questions:
1. Who is responsible for the integrity and objectivity of the financial statements of CVS?
2. What is the system of internal controls of CVS designed to accomplish?
3. In addition to management, who reviews the system of internal controls for improvements and modifications necessary because of changing business conditions?
4. Were there any changes in the internal controls over financial reporting in 2004?
5. Who are the independent auditors of CVS?
6. Do you think having the chief executive officer and chief financial officer of CVS serve on its Audit Committee is a good way to foster an effective control environment?
7. Do members of the management team of CVS serve on the Audit Committee of the Board of Directors?