Corporate Governance, Explanatory Notes, And Other Disclosures
Corporate Governance, Explanatory Notes and Other Disclosures
Governance activities and the signals they send to the marketplace form the public’s perception of the entity’s acknowledgment and performance of its citizenship responsibilities.
Business ethics, social responsibility, equitable treatment of stakeholders, full and fair disclosure, and the responsibility of the board of directors and its various committees are at the core of the governance concept.
The Sarbanes-Oxley Act (SOX) of 2002 is the most powerful legislation to date to have been created due to recent corporate governance failure.
Explanatory Notes to Financial Statement
Readers must be able to learn about the following issues that affect their ability to understand financial statements:
- Depreciation Methods
- Inventory Cost Flow Assumptions
- Current and Deferred Income Taxes
- Employee Benefit Information
- Earnings Per Share of Common Stock Details
- Stock Option and Stock Purchase Plan Information
Other Explanatory Note Disclosures
- Management’s statement of responsibility
- Management’s discussion and analysis
Independent Auditors’ Report
The Independent Auditors’ Report helps ensure that financial statements present fairly, in all material respects, the financial position and results of operation of an entity.
Auditors do not guarantee that financial statements are free from error or fraud.