Make sure to use this as a study guide and do not submit as it is.

FIN 370 WEEK 2 TEAM ASSIGNMENT - ETHICS AND COMPLIANCE PAPER

Ethics and Compliance PaperSelect an organization from the following list:PepsiCo. Wal-MartLowes StarbucksBarnes and Noble Amazon.comHewlett Packard DellDisney Microsoft Be sure to obtain faculty approval of your selection prior to beginning this assignment. Obtain a copy of your selected organizations annual reports and SEC filings for the past two years. Prepare a 1,400-1,750-word paper in which you analyze the data in your selected organizations annual reports and SEC filings. In your analysis, be sure to address the following:o Assess the role of ethics and compliance in your selected organizations financial environment.o Describe the procedures that your selected organization has put in place to ensure ethical behavior.o Identify the processes the organization uses to comply with SEC regulations.o Evaluate your selected organizations financial performance over the past two years using financial ratios. Calculate the following ratios for each year:Current RatioDebt RatioROE (Return on Equity)Days Receivable OutstandingBe sure to define how each ratio is calculated, analyze the trend for each ratio, and discuss what it tells you about the organizations financial health.

PEPSIIn todays market we see a much larger need as consumers to see direct accountability by larger corporations. Pepsi Co is no exception to this. The stockholders for these corporations have realized the need to approve of the financial reports that are generated in order to determine whether or not this is a good investment for their time and money. By examining the financial reports that Pepsi Co makes available as well as analyzing the SEC filings, the stockholder is able to determine the companies standing as well as their accountability.

The Pepsi Company (PepsiCo) has one of the largest portfolios in the world. This company is responsible for many transactions that occur in the industry. As of any other group that is publicly trading in the market, PepsiCo is accountable for the many financial dealings that happen within the company and of the public. That accountability is vigorously shown in their annual report which can be accessed publicly. In compliance with state laws and governing committees, the company has shown adequate reliability in their statements and reports. People who have a stake in the company have the right to know how the money is being used and where it goes.Nothing should be hidden as it is unethical to do so. In terms of ethics, the annual report should only be of true facts and none should be embellished. This has been the goal of the company as stated in their policies. Also, their policies regarding their duties in managing finances demands integrity in monitoring the different financial aspects of the company. Internal control is one of the important tools used in keeping track or making sure that everything is within the guidelines and regulations of the company. Those internal controls are also tested out to see if they are according to law.

The company is evaluated annually to check the inconsistencies and correct them when given the chance. Evaluations are important as to keep the company on a straight path. The company also endorses the fact that if their policies or programs is in conflict with state law or federal law, that they will respect those of the government as superior to theirs ("PepsiCo", 2011). Outside sources has found the management of finances by PepsiCo to be effective and compliant.PepsiCo as an organization has multiple procedures in place to ensure ethical behavior in every department of the company. Ethical behavior practices can be applied in daily functions and routines within the company. [PepsiCo has adopted strict corporate standards that govern our operations and ensure accountability for our actions. Such policies cover areas of Corporate Governance, Human Sustainability, Environmental Sustainability and Talent Sustainability (2011) PepsiCo]. Internal audits are conducted by routine and surprise visits to all departments to ensure no wrong doings in accountability of currency or data recording have taken place.Business to business as a global and international company PepsiCo maintains a record of dealing with other companies and corporations that comply with both international and domestic laws also. Accountability of PepsiCos employees is maintained by releasing any employees who conduct any actions UN ethical. Company meetings are held to give lessons by members of human resource to ensure that each employee is aware of which practices are considered ethical by regulation and the company regularly also.

In 1976 a code of conduct was created and is often updated and communicated to all PepsiCo associates annually. [The Code is available in 42 languages and includes provisions relating to ethical business dealings, bribery, business gifts and entertainment, confidentiality of information, insider trading, protection of company assets, discrimination, harassment, equal opportunity, accounting and record-keeping, health and safety, environment, political activities and whistle-blowing (2011) PepsiCo]. Annual reports are reviewed for accuracy and held to standards of the United States Securities and Exchange Commission and are available for review by anyone online. These reports are also communicated on a regular base to all shareholders and employees.The United States financial markets are also used for individuals to borrow money to finance personal needs. Financial markets are where barrowers, investors, and financial institutions come together. The financial markets are used for companies and individuals to borrow money and investors to invest their money.

One way the financial markets works is first there are investors that put money into financial institutions (commercial banks, finance companies, insurance companies, investment banks, and investment companies). Then the financial institutions borrow out the money to companies or individuals that need the money to finance the things they want (some examples are automobiles, company equipment, property, and company bills). The investor earns a small interest on the amount of money they invested and the borrowers are charged an interest or borrowing the money. The interest that the banks charge to the borrowers is higher than the interest that the investors earn for their investment. This is where the financial institutions make their money.There is also another type of financial market. This is where larger corporations sell securities to investors. These markets are called primary and secondary markets. The primary market is where the corporation sells the security for the first time to an investor. The secondary market is where securities are sold from one investor to another investor. The security can either be in the form of a debt or equity security. A debt security is a security that must be repaid where an equity security is a security that represents ownership of the corporation. The equity securities are divided into common stock and preferred stock. Common stock is a security that represents ownership of a corporation. This gives the security holder voting rights, and entitles the holder to a share of the companys profits in the form of dividends and any capital appreciation in the value of the security. Preferred stock is like common stock, but the preferred stock holders receive dividends before the common stock holders.

This leads to the stock market. A stock market is where the public is allowed to sell or trade stock of companies. There are two classifications of stock markets these would be the organized security exchange and the over-the-counter market. The organized security exchanges are tangible entities and financial instruments are traded. The over-the-counter markets are where all other security markets except the organized exchanges take place. The United States largest public market is the New York Stock Exchange (NYSE) is considered a hybrid market because it occupies a physical space which is an organized exchange, but it also does have automated electronic trading which makes it an over-the-counter market. The other United States stock market would be the National Association of Securities Dealers Automated Quotations (NASDAQ) is an over-the-counter market. Both of these stock markets are made for the public to buy, sell, and trade securities.PepsiCo works endlessly to ensure the companies compliances with SEC regulations. One of the ways PepsiCo shows its willingness to comply with SEC regulations is by making the 10-K report accessible to its shareholders. This report is used to carefully assess the financial performance of the company over a period of time. With the use of corporation governance, the company sets and maintains high standards in all aspect of the company operations. These standards set by the company holds the company accountable for their actions and builds and strong relationship with the shareholders.

PepsiCo is one of the nation leader in providing its shareholders above average return on their investments. The Company's approach to superior financial performance is owed to addressing three issues, human, environmental and talent sustainability (PepsiCo, 2008). The use of an audit committee is another way PepsiCo ensures the compliance with SEC regulation. The committee job is to provide insight to PepsiCo incorporated board of directors on the corporations financial statements, the internal controls that govern the financial reports (PepsiCo, 2008). The committee is also responsible for making sure the processes for compliance with SEC regulations are taken seriously and carried out.

The SEC regulations the Audit committee focus on are the regulations regarding the Corporations financial reporting and disclosure process, disclosure requirements, and internal control systems (PepsiCo, 2008). I all thing communication is the key to a good relationship and it is no different when it comes to PepsiCo efforts to comply with the SEC regulations. The need for constant communication between both PepsiCo and the SEC is greater now than ever before. The SEC has constant rule changes and it is the job of PepsiCo to know and follow each new rule.Financial ratios are used to standardize PepsiCos financial information from the income statement and balance sheet. The ratios provide a look at the firms performance and health in relation to past figures and offer information to create a comparison against other businesses in the financial market. The current ratio is used to assess PepsiCos overall liquidity by comparing current assets to current liabilities. In 2009, PepsiCos current ratio was $1.44 and in 2010, its ratio was $1.11. Comparing PepsiCos current ratios show that the company was less liquid in 2010 than in 2009. The debt ratio measures the percentage of the firms assets that were financed using current plus long-term liabilities (Titman, Keown, & Martin, p.85, 2011).PepsiCos debt ratio in 2009 was 56% and 68% in 2010, which shows that the company used more debt in 2010 than in 2009. Stockholders are interested in PepsiCos return on equity (ROE), the amount returned on their investment. PepsiCos ROE in 2009 was 35.2% and the ROE dropped to 30% in 2010. The ratio for days receivable in 2009 was 39 days versus 40 days in 2010, showing that the amount of time PepsiCo took to collect receivables stayed relatively consistent for the two consecutive years. Analysis of the trends for each ratio shows that PepsiCos financial health is reflected in the ratios which show a noticeable declined in all areas between 2009 and 2010. The company is less liquid, incurred more debt, produced a lower return on investment to shareholders, and took slightly longer to collect receivables.After reviewing Pepsi Co as a whole, it is apparent that the company is completely compliant with SEC regulations. The company is very straightforward with their financial standing and publicly offers access to their reports. Pepsi is an extremely large corporation yet they maintain their integrity by placing a high priority on the easy access to their information and being an open book for their stockholders and anyone else who might be interested in the financial standing of the company.Pepsi-Cola Financial Ratios

2010 2009

Current Ratio $1.11 $1.44Debt Ratio $0.68 $0.56Return on Equity 30% 35.2%Days Receivable 40 days 39 days

ReferencesPepsiCo Inc. 2011 Retrieved February 18, 2012 from http://www.pepsico.com/Purpose/Overview/Policies.html

Titman, S., Keown, A. J., & Martin, J. D. (2011). Financial management: Principles and applications (11th ed.). Upper Saddle River, NJ: Pearson/Prentice Hall.

Wal-Mart

Assess the role of ethics and compliance in your organizations (we chose Wal-Mart) financial environment.Ethics plays a big role in the fields of Finance and Accounting; Any actionsthat violate ethical standards can cause a loss of trust, which can, in turn, have a negativeand long-lasting effect on the firm.(Financial Management, Principles and Applications. Keown, J., Martin, J., Petty, J., & Scott, D. P. 312)Having said that, we should point out that the viability of any firm mainly depends on its credibility with its customers, employees, suppliers, as well as its competitors. This is in addition to the fact that investors must believe that the firms published financial reports are a fair representation of the firms financial condition. Without this trust outside investors would refuse to invest in the shares of publicly traded firms and financial markets would collapse(Ibid. P. 20)Upon examining Wal-marts Statement of Ethics, one can easily see why it is consistently listed among Americas most admired companies by fortune magazine. Starting with the message from the Chief Executive Officer, we read The values that set us apart from others -- respect for the individual, service to our customers and striving for excellence -- rest on the foundation of personal integrity and responsibility. Associates in all areas and levels of our business are responsible for understanding and complying with ourStatement of Ethics.(http://ethics.walmartstores.com/WalMartEthics.pdf. P.3)

In his letter, Mike Duke (Wal-marts CEO) encourages employees to speak up whenever they have any concerns about any inappropriate behavior they observe, he also encourages employees to use available resources such as the Open Door Process and the Global Ethics Helpline to report such behaviors. He concludes his letter by stating that A strong commitment to ethics and integrity isnt just the right way to do business. Its how we earn the trust and respect that is critical to our success, and our ability to help more people live better. Our customers trust us to be their advocate. Our suppliers trust us to be an equitable partner. And as Walmart associates, we trust each other to uphold the highest standards of conduct every day(Ibid. P.3)On page five of the same statement, Wal-mart lists its guiding principles; by following such guideline Wal-mart encourages its employees to uphold and apply ethical behavior which proves that in Wal-marts culture, ethics plays an integral part in the firms success.

Microsoft

Microsoft Corporation takes ethics andethicalbehaviorin the workplace very serious and as suchhasmany policies andproceduresin placetoensurethe company's ethics remain on the highest level. Microsoft's office of Legal and Corporate Affairs is the backbone of ensuring a compliant andethicalworkplace. As such, the office of LCA issues the company's code of conduct, known as the standards of business conduct, which is a document that lays out specifically the guidelines that all employees at Microsoft Corporation agree to abide by as employees. This governing document also includes the company's core values which touch upon the following: Integrity and honesty Passion for customers, partners, and technology Open and respectful with others and dedicated to making them better Willingness to take on big challenges and see them through Self-critical, questioning, and committed to personal excellence and self-improvement Accountable for commitments, results, and quality to customers, shareholders, partners, and employeesIn addition, according to Microsoft, on top of the standards of business conduct, the "LCA's leaders reinforce our commitment to integrity as a fundamental part of every job within the Department ? a commitment that goes well beyond compliance with legal obligations" (Corporate Compliance, 2010, p.1). Thus, Microsoft creates an environment where ethics are clearly expected, defined and enforced to all employees on all levels. This creates an corporate identity where ethics are a part of the company's culture and as thus become part of the fabric of Microsoft.Yet still, when it comes to complying with SEC regulations, Microsofthasalso continued toensurethatproceduresare inplaceas well to emphasize the company's commitments to issues relating to corporate governance. Thishasbeen evidenced through Microsoft's use of a lead independent director, as well as maintaining seven independent Board Committee member's toensureindependent decision makers at the corporate level. These individuals act as outside eyes and ears to make sure that SEC compliance is evident in the actions, statements and public information that Microsoft Corporation engages in.Furthermore, the use of Deloitte & Touche LLP as the company's independent auditor as well creates a clear foundation for an outside source to inspect and document that Microsoft is a forthright corporation interested in corporate compliance and regulation. All of these factors have combined to create an environment where complying wit SEC regulations is at the forefront of Microsoft Corporation on all levels, both on an internal and external basis.References:The Microsoft Corporation (2010).Corporate Compliance(Company website). Retrieved on September 17, 2010. Fromhttp://www.microsoft.comThe Microsoft Corporation (2010).Corporate Governance(Company website). Retrieved on September 17, 2010. Fromhttp://www.microsoft.com

Microsoft (Different)In todays fast pace society corporate America seems to be above scrutiny. The time ofthe watch dog presence seems to have become lack and almost non existent. Giant corporations offer extremely attractive salaries and bonus packages to their employees.Employees in exchange do a good job but loyalty to the company is the most importantthing.One mega giant is Microsoft as a company they boast of integrity, honesty, openness, and personal excellence. The company holds itself accountable to their customers and all of their employees by providing the best product at the most economical price possible. Microsoft is focused on employee training as well as employee promotion from within. These guidelines are the reason that Microsoft feels the employees will do noting to jeopardize the reputation of the company or any of its subsidiaries.

Ethics and Compliance

Microsoft values the employees and the values that were created in a foundation for the business. Microsoft Company manages their business in compliance with laws and regulatory requirements. They obey laws and regulations that are governed by global management. When it comes to their financial integrity they are honest and accurately report any business information as well as recording it. Microsoft complies with local, federal laws and state, regarding the completion and accuracy of what is recorded. They have a requirement that financial transactions be deleted with managements say so and recorded in a ethical manner to maintain accountability for Microsofts assets. Our financial information reflects only actual transactions and is in compliance with Microsoft and other applicable accounting practices. The CEO, CFO, Corporate Controller and other employees of the finance organization are also required to comply with the Microsoft Finance Code of Professional Conduct. (Microsoft, 2010).

Microsoft Procedures to Ensure Ethical Behavior

Microsoft Finance provides top-notch financial leadership to increase long-term share-holder value and is a leader in using processes including innovative, tools, and systems. Microsoft Finance team members value, results, service, integrity, and making others successful through their labors. Microsofts Finance Code of Conduct mission promotes professional conduct in worldwide financial management Microsofts Corporate Executive Officer, Chief Financial Officer, controller, and other employees of the organization and finance department have and extremely imperative task in corporate control and capable of ensuring the interest of the stakeholders investments are protected ("Microsoft Investor Relations",2012). Microsofts finance professional code of conduct encompasses values that adhere to and support. The professional philosophy of business ethics embodies rules for the responsibilities of individuals and peers in addition to the stakeholders, the general community, and Microsoft employees.

The Corporate Executive Officer, Chief Financial Officer, and finance department employees must follow Microsoft business ethical policies and standards and other codes. Noncompliance of the Microsoft Finance Code of Professional conduct may result in immediate disciplinary action up to and including termination ("Microsoft Investor Relations",2012). According to"Microsoft Investor Relations"(2012), Employees are advised to act with Honesty and integrity, and avoid any conflict of interest in their personal and professional relationships. All employees will provide stakeholders with information to be precise, complete, objective, fair, relevant, timely, and comprehensible, including information in confidential files to the U.S. Security and Exchange commission and other public bodies. All employees are advised to meet the terms the rules and regulations of federal, state, local governments, and other private, and public agencies.All employees are advised to act in good faith, responsibility, competence, and truthfully to material facts or acting insubordinate in judgment(1-3).According to"Microsoft Investor Relations"(2012), All employees are advised to respect information and confidentiality in the course of work except if asked to disclose information in a legal situation. Employees should not use confidential information for personal gain. Employees should maintain professional skill and share knowledge relevant to stakeholders needs.

All employees are advised to promote ethical behavior and be an example among peers, in the community, and work environment. Employees will exercise responsible use, stewardship, and control over all Microsoft assets and resources used as an employeeMicrosofts Code of conduct also states advises against coercion, misleading, manipulating, or influencing any official audit or obstruct any auditor engaged in performing internal or independent audits of financial statements, accounting books, and records, or systems of internal control. If there are any suspected violations employees should report concerns to a manager or someone else holding management responsibilities, a human resources representative, a director of compliance, or LCA contact ("Microsoft Investor Relations",2012).

Financial Markets in the United States

Microsoft use in the financial arena includes individuals and organizations that trade money and credit in financial markets. Three entities interact within the markets to move money from those who have it to those who need it to operate including individuals, businesses, and governments. Investors (savers) lend money to borrowers through financial institutions (intermediaries), including commercial banks, finance companies, insurance companies, investment banks, and investment companies. We call these institutionsfinancial intermediaries because these institutions stand between those who have money to invest and those who need money (Titman, Keown, & Martin, 2011, p. 20). Additional financial markets are the securities markets, which include primary markets that enable corporations to sell interest in their organizations (equity securities such as common or preferred stock) to the public to raise initial operating capital. Secondary markets enable individuals to buy and sell existing public company stocks in the stock markets.

The United States classifies stock markets as over-the-counter (OTC) and organized exchanges. OTC exchanges are virtual and floorless like the National Association of Securities Dealers Automated Quotations (NASDAQ) formed in 1971. Organized exchanges are like the New York Stock Exchange (NYSE) formed on Wall Street in Manhattan, New York, in 1792. However, today the NYSE also has the qualities of an OTC market.Organizations can also raise money by borrowing money from investors through selling debt securities in the debt securities market. If a company sells debt for a term of one year or less, it is sold in what is known as the money market. However, if debt is sold with a maturity of one to 10 years (a note) or over 10 years (a bond), it is sold in the long-term market known as the capital market. (Titman, Keown, & Martin, 2011, pp. 26-29).

Compliance with SEC Regulations

This indiscretion prompted Microsoft to change their policies they now have atransparent policy whereby anyone whether company affiliated or not can ask for the financial records of the company at any time and they are surrendered upon demand. Microsoft also post their information on the internet quarterly for all to see. .

Organizations Financial Performance

Microsofts financial performance over the last two years did show fluctuations.

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Microsoft has improved its financial performance in 2011. The ratios show that the company had more assets per dollar of debt in 2011 than it did in 2010, though it financed more of its current and short-term liabilities with those assets than in 2010. The company owned $2.60 in assets per $1 in debt in 2011, up from $2.13 in assets per $1 in debt in 2010. The company did not do as well with collecting debts owed it in 2011 versus in 2010. The average time it takes to collect on an unpaid invoice in 2011 was 78.2 days, compared with only 76 days per invoice in 2010. However, despite having more assets per dollar of liability in 2011, the return to each stockholder did not change from 2010. The return on equity for both years was 40.6%. A stockholder would not have noticed a difference in his or her personal income from the company, even if the company was able to increase its assets from one year to the next.

Microsoft is a company that has long been at the forefront of enterprise and innovation including standardizing practices. Microsoft as with all giant corporations has not been without its share of problems. Investigations, allegations, and finally problem solving, and solutions. Microsoft stands ready to meet the challenges of its customers, employees, and partners.

ReferencesRetrieved fromhttp://Microsoft:www.microsoft.com/investor/AnnualReports/default.aspxRetrieved fromhttp://Forbes.http://finapps.forbes.com/finapps/jsp/finance/compinfo/Ratios.jsp?tkr=MSFRetrieved fromhttp://www.microsoft.com/investor/CorporateGovernance/BoardOfDirectors/Contacts/MSFinanceCode.aspxRetrieved fromhttp://www.microsoft.com/About/Legal/EN/US/Compliance/Buscond/Default.aspxRetrieved fromhttp://www.sec.gov/news/press/2002-80.htmTitman, S., Keown, A.J. & Martin, J.D. (2011). Financial management: Principles and applications (11th ed.). Upper Saddle River, NJ: Pearson/Prentice Hall.

-----------------------In 2002 the U S Securities Exchange Commission brought a settled administrative enforcement action against Microsoft Corp. ordering the company to cease and desist from committing accounting violations and other violations of federal securities laws. Microsoft misstated its income by material amounts in certain periodic filings with the Commission made between July 1, 1994, and June 30, 1998. The Commission also found that Microsoft did not properly document the bases for these accounts and failed to maintain proper internal controls, as required by the federal securities laws.(news press)

2010 Current Ratio: 55676/26147 = 2.13 times Debt Ratio: 39938/86113 = 46.4% Return on Equity Ratio: 18760/46175 = 40.6% Days Receivables Ratio: 13014/62484/365 = 76 days 2011 Current Ratio: 74918/28774 = 2.6 times Debt Ratio: 51621/108704 = 47.5% Return on Equity Ratio: 23150/57083 = 40.6% Days Receivable: 14987/69943/365 = 78.2 days

AmazonIn order to be financially successful a business must adhere to several ethical rules in order to be in compliance with the law and society. Amazon.com has become one of the number one online tools for selling new and used products all over the world. Amozon.com contributes its success to their daily customers but has also made sure to keep strict records and public files in order to prove their promise to be ethically responsible to their sellers, buyers and the environment. This paper will cover the steps that Amazon.com has implemented in order to be compliant with business law, and just as important, how they have strived to keep the Amazon.com trade mark and positive and ethically correct symbol all over the world.Assess the role of ethics and compliance in your organizations financial environment.-Amazon.com has 12 guidelines that define their Corporate Governance or their Code of Business Conduct and Ethics. Within the company everyone, including the board of directors are held responsible for upholding these guidelines at all time while working as agents of Amazon.com. The first guideline is to be compliant with laws, rules and regulations. This requires that every person within Amazon.coms company adhere to all laws and regulations. The second guideline restricts conflicts of interest. While this guideline has been left open to the judgment of the specific employee, secondary guidelines, concerning personal interaction with customers or accepting gifts of any nature, have also been developed by their own legal department. This helps the employees understand when it is acceptable to take such gifts or when it crosses the line and becomes a conflict of interest, impacting their job or customer relations. The third guideline addresses the insider trading policy. Since employees may have information that is not known to the public, Amazon.com restricts sales of stock amongst employees until all information is made public in order to stay compliant with insider trading laws. The fourth guideline addresses discrimination and harassment. Amazon.com has a strict zero tolerance policy regarding any type of discrimination of harassment. The fifth guideline states that every employee is responsible for the health and safety of the working environment and themselves. It requires that not only the working areas be kept in compliance with safety guidelines, but that all employees also be free from any kind of influence while on the job. The sixth guideline restrict employees from discussing or setting and type of price fixing in order to stay compliant with anti-trust laws. The seventh guideline prohibits any payments to government personal in order to stay compliant with the U.S Foreign Corrupt Practices Act. It requires that any employee who is doing business with a government official be reported to the legal department for review to make sure that the policy is adhered. The eighth guideline requires that all record keeping reporting be of the upmost financial integrity and be within accordance of the applicable law. They require that their accounting and legal groups take full responsibility that everything that is reported is true, accurate and timely. The ninth guidelines has implemented a process for anyone feeling the need to report violations as well as track those reports and investigate, while keeping the safety of the reporting person a high priority. The legal department is responsible for upholding the tenth guidelines and checking for periodic certification that states all employees have read and agree to abide by the guidelines above. The eleventh guideline requires that even the board of directors be held responsible in the upholding all of the guidelines set forth to uphold the highest quality of ethical behavior. The last guideline states that the only waivers that may exist are those that are allowed by law.ReferencesLibby, Libby, & Short.(2001) Financial Accounting. Manhattan, New York: The McGraw-Hill Companies, Inc.

Pepsi (different )Ethics and Compliance (Introduction)Role of Ethics and Compliance (Josif)In this study Team A will be determining the role that ethics and compliance plays in Pepsi-Colas (PepsiCo) financial environment. By analyzing this information obtained through researching Pepsi-Colas annual report we are able to understand the process that is used when filing the companys regulations to the Securities Exchange Commission (SEC). Pepsi-Cola makes the 10-k report available to its shareholders so that they will be able to see and evaluate the financial performance over the last two years. These reports show the organizations current financial status through its current debts and returns on equity it holds while also showing the trends between these ratios give an explanation of the financial wealth of Pepsi-Cola.Through company governances as an organization Pepsi-Cola believes and operates with strict standards in operating the organization and holding it accountable in effort to deliver growth while building a strong company financially for its shareholders. The companys approach to superior financial performance is owed to addressing three issues, human, environment, and talent sustainability (Pepsi-Co, 2008). The challenges that Pepsi faces if approached correctly will allow the company to achieve both business and financial success while leaving a positive imprint on society.The Audit Department for Pepsi-Cola maintains the financial statements and presents them to the Board of Directors. There are also internal controls that help to govern the production of the financial reports. The expertise of the department and its members give insight for the compliance regulations for the companys financial reporting, the disclosure process and requirements, and internally controlled systems. The tasks of this department are vital in maintaining effective communication with the Board of Directors because of involvement of auditors and their agendas. Subsequently, the audit department reports issues that concern internal quality control issues that are at times investigated by government or professional authorities.

Ensuring Ethical Behavior (Barb)At PepsiCo. they believe that Good for all is good for business.(PepsiCo., 2010) Performance with purpose means delivering sustainable growth by investing in a healthier future for people and our planet.(PepsiCo., 2010) PepsiCo. is working to reduce their carbon footprint and are also giving back to the communities which they operate in by working with local farmers and providing jobs to local people. The procedures that PepsiCo. has invested in to ensure a healthier environment are reducing water usage, increasing recycling levels, and reducing packaging weights to reduce their carbon foot print. The procedures that they use to ensure that their employees performance levels are up to par is to make training and development a priority. PepsiCo. also provides their employees with options to stay healthy because they believe that giving their employees options as such will expand their performance levels. PepsiCo makes many options available to their consumers. PepsiCo. has three main product portfolios available to their consumers. The first portfolio is the Fun-For-You portfolio which includes their fried chips and full calorie beverages. The second portfolio is their Better-For-You portfolio which includes baked chips and diet beverages. The third portfolio is their Good-For-You portfolio which includes whole grains such as their Quaker Oatmeal, Izze, Gatorade, Tropicana Juice, Nut Harvest and Naked Juice. By offering a variety of products they are able to capture a more diverse group of consumers. By working to reduce their carbon footprint and providing a variety of health conscious options PepsiCo. plans on expanding their portfolio to triple what it offers now with more healthy options by 2020.Complying with SEC regulations (Eric)The overall goal of the SEC is to ensure that investors have enough information to determine if and when to invest in a company. Rather than to just trust a company and what it says it earns or is worth, the SEC regulates the flow of information and makes companies run in compliance with the law. As seen in the past, this is a necessity to have in any free market where independent investors are given the opportunity to invest their own money into a company. Part of the SECs regulations states that proper paperwork must be done by companies to keep potential investors up to date with the companys latest financial information. As long as the company is publicly owned (that is, that it is traded on the stock market and owned in stock form by multiple investors who may buy or sell their shares), they must follow the SEC regulations. To keep with these regulations, Pepsi-co is almost constantly submitting new documentation that becomes available to the public. One of the biggest red flags that is seen on the stock market is insider trading. Insider trading is when an investor is given special information that it not given to the public investor. This allows the insider to make a move with their stocks just before the stock plummets. The SEC and their collection of documents and data pertaining to any sort of spending and investing by companies helps to ensure that this does not happen.Pepsi-Cola Financial Performance Year 2008 and 2009 (Daniel)In terms of the current ratio for year 2008 and 2009, Pepsi Cola has an average of $1.34 in current assets for every $1.00 in current liabilities:Year 2008 current assets-$10,806MYear 2008 current liabilities-$8,787MCurrent Ratio expressed as:$10,806M / $8,787M = 1.23Year 2009 current assets-$12,571MYear 2009 current liabilities-$8,756Current Ratio expressed as:$12,571M / $8,756M = 1.44This current ratio shows that Pepsi-Cola has more enough liquid assets relative to its short-term debt obligations, an excellent indicator of the firms ability to meet any outstanding debt obligations.For Pepsi-Colas debt ratio, we see that the companys debt as a percentage of total assets averages 61.25%. The debt ratios for year 2008 and 2009 follow:Year 2008 total debt-$23,888MYear 2008 total assets-$35,994MDebt Ratio expressed as:$23,888M / $35,994m=66.3%Year 2009 total debt-$22,406MYear 2009 total assets-$39,848MDebt Ratio expressed as:$22,406M / $39,848M=$56.2%This higher than average debt ratio may be due to the fact that Pepsi-Cola has more real assets such as land and buildings and are able to finance more of their assets with debt (Keown, Martin, & Petty, 2005, p. 81).Ratio Trends and Financial Health (Christina) Current ratios help determine the relative liquidity of a company by comparing cash and other assets to the amount of debt coming due owned by year end. The Pepsi-Cola company appears to be healthy despite its recent global financial status. Looking at 2008, PepsiCo finished very close to the current ratio of 1, even though PepsiCo rebounded well in 2009. With all the factors of the current ratio examined, PepsiCos ability to pay back short-term debts, using short-term assets is exceptionally reputable (PepsiCo, 2009). A companys debt ratio, total debt divided by total assets, indicates what portion of debt a company has relative to its assets. This debt ratio measurement gives a view of the risks facing a companys debt load. Pepsi-Colas debt ratio for the fiscal year ending in 2009 was over 56% and a greater value of around 65% (PepsiCo, 2009). A debt ratio of greater than 1 indicates that a company has more debt than assets, a debt ratio of less than 1 indicates that a company has more assets than debt (Investopedia, 2011, p. 2). It appears the 2008 fiscal figures of 65%, indicate PepsiCo financed its assets more by using debt than equity, but rebounded in fiscal year 2009, posting a 56% figure. PepsiCos 2008 figures seem apropos based on the financial quandary the United States economy faced. Team C observed PepsiCos 2008 debt ratio two ways. First, the companys financial health may have been the result of a weakening 2008 economy because of peripheral sources. Second, the company decided despite possessing available assets to pay bills, the choice was made to focus more on equity than debt in 2009 (PepsiCo, 2009). Return on equity (ROE), which is obtained by calculating net income divided by total equity, will illustrate how well a company utilizes assets to generate income. In the fiscal year ending 2009, PepsiCo showed a 34% ROE, and a 40% ROE for fiscal year ending 2008. A larger 2009 equity base of $16B compared with a $12B equity base for 2008, may have contributed to the ROE disparity (PepsiCo, 2009).

ConclusionReferencesInvestopedia (2011) Debt ratio, Retrieved on June 5, 2011, from http://www.investopedia.com/terms/d/debtratio.asp

Keown, A. J., Martin, J. D., Petty, J. W., & Scott, D. F. (2005). Financial management: Principles and applications (10th ed.). Upper Saddle River, NJ: Pearson/Prentice Hall.PepsiCo. 2010 Annual Report. Retrieved from http://www.pepsico.com/Download/PepsiCo_Annual_Report_2010_Full_Annual_Report.pdf PepsiCo (2009) Annual reports, Retrieved on June 5, 2011, from http://www.pepsico.com/Investors/Annual-Reports.html Starbucks Ethics and Compliance Research was conducted to seek out information pertaining to ethics and compliance regulations at Starbucks Corporation. The analysis will provide oversight of ethics policies and procedures, SEC compliance regulations and therefore illustrate the ethical health of Starbucks. Furthermore, this paper provides an overview of financial health of Starbucks. The financial health and viability of Starbucks is identified by calculating liquidity ratios (current ratio), financial leverage management ratios (debt ratio), profitability ratios (return on investment) and asset management ratios (receivable/day). The goal of the aforementioned analysis is to fully understand the financial strength and path of Starbucks.

Ethics and Compliance within Starbucks Financial Environment

Starbucks ensures ethical behavior and identifies the rules and policies stipulated by the Mission Statement, business ethics and compliance, corporate governance and the Board of committee charters and policies. Starbucks mission statement states Our mission: to inspire and nurture the human spirit one person, one cup and one neighborhood at a time (Starbucks Corporation, 2010, Mission Statement). The business ethics and compliance program is created to support Starbucks mission and ensure the integrity of Starbucks culture and reputation worldwide. This program develops and distributes awareness materials, facilitates compliance with legal requirements and aids in ethics training. Furthermore, this program also enables investigation of potential conflicts of interest and is an excellent venue for addressing partner concerns.

Corporate governance materials are posted on the companys website and available to the public at http://www.starbucks.com/about-us/company-information/corporate-governance. The materials in question include Starbucks Corporation Corporate Governance Principles and Practices for the board of directors, Restated Articles of Incorporation of Starbucks Corporation, Amended and Restated Bylaws of Starbucks Corporation, Code of Ethics for Company Executive Officer and Finance Leaders (as of December 18, 2003), Starbucks Corporation Director Nominations Policy, and Starbucks Corporation Procedure for Communicating Complaints and Concerns. The Board of committee charters include: Starbucks Corporation Audit and Compliance Committee Charter, Starbucks Corporation Compensation and Management Development Committee Charter, Starbucks Corporation Nominating and Corporate Governance Committee Charter, and Starbucks Corporation Audit and Compliance Committee Policy for Pre-Approval of Independent Auditor Services (starbucks.com).

Starbucks strives for transparency and discipline of all the procedures presented in the organization. All Starbucks reports and amendments are filed or furnished to the Securities Exchange Commission (SEC).

These reports are available to the public at no charge on the companys Investor Relation section of their website http://investor.starbucks.com or at www.sec.gov as soon as reasonably practicable after these materials are filed with or furnished to the SEC. The information on the Companys website is not part of this or any other report Starbucks files with, or furnishes to, the SEC (Annual, 2009).

Starbucks Financial Performance for 2008-2009

An important aspect of any company is its liquidity or ability to pay its bills on time. One way to determine the liquidity of a company is to calculate the current ratio. The current ratio calculation is the result of current assets divided by current liabilities. Starbucks Corporation annual reports of 2008 and 2009 are the source of information used to calculate the current ratio.

Starbucks current assets for 2008 (in millions) = $1,748.0

Starbucks Corporation current liabilities for 2008 (in millions) = $2,189.7

Current ratio for 2008 = 0.7980.8

Starbucks Corporation current assets for 2009 (in millions) = $2,035.8

Starbucks Corporation current liabilities for 2009 (in millions) = $1,581.0

Current ratio for 2009 = 1.2871.29

By looking at the current ratios of 0.8 and 1.29 respectively, one can determine that Starbucks Corporation has $0.8 and $1.29 in current assets for every $1 of current liabilities for the 2008 and 2009, respectively. Therefore, to satisfy the claims of short-term creditors exclusively from existing current assets, Starbucks Corporation must be able to convert each dollar of current assets into at least $1.25 (1/0.8) and $0.77 (1/1.29) of cash respectively (Moyer, McGuigan & Rao, 2007). According to Investor glossary, current ratio of more than 1.0 means that a company's short term assets exceed its short term liabilities (Investor Glossary, 2010, Current Ratio). Considering the aforementioned data and results of the current ratio for Starbucks Corporation, one can conclude that its liquidity has improved from 2008 to 2009 and that in 2009 Starbucks Corporation can meet its short-term obligations. However, the financial strength of Starbucks Corporation cannot be determined solely by the current ratio. Additional analysis in form of quick ratio, debt ratio, inventory turnover ratio, and WACC analysis would provide more insight.

Debt ratio illustrates the percentage of creditors financing of the firms assets. Starbucks Corporation debt ratio for years 2008 and 2009 is calculated by total debt divided by total assets.

Starbucks Corporation total debt for 2008 (in millions) = $3,181.7

Starbucks Corporation total assets for 2008 (in millions) = $5,672.6

Debt ratio for 2008 = 0.56 =56%

Starbucks Corporation total debt for 2009 (in millions) = $2,531.1

Starbucks Corporation total assets for 2009 (in millions) = $5,576.8

Debt ratio for 2009 = 0.45 = 45%

A debt ratio of 56% indicates that 56% of company assets have been financed through debt for year 2008. The situation has improved in 2009, indicating that only 45% has been financed through debt. This may be the cause of the reduced debt from 2008-2009, possibly the direct result of improved cost structure that removed $580 million in costs for fiscal 2009 (Starbucks Corporation, 2009, Annual Report). The decrease in the debt ratio illustrates that the companys cash flow has improved resulting in its ability to meet interest payments and its ability to issue new debt obligations should it require additional funds (Moyer, McGuigan & Rao, 2007).

The return on equity (ROE) is important financial information for businesses and investors. The amount of net income returned as a percentage of shareholders equity is a technique utilized to analyze the risk of investing in a specific business. A corporations profitability can be measured by examining the ROE that discloses the amount of capital produced by shareholder investments. In other words, the ROE quantifies how well a business uses the capital bestowed by its investors. This ratio can be used to determine the future growth rate so that investors can assess the risk involved (Keown et al., 2005). ROE is expressed as a percentage and calculated as:

Return on Equity = Net Income/Shareholder's Equity

Starbucks Corporation annual reports from 2008 and 2009 were used to determine the ROE ratio as follows:

Starbucks Corporation total net income for 2008 (in millions) = $459.5

Starbucks Corporation total shareholders equity for 2008 (in millions) = $2,490.9

Return on Equity (ROE) ratio for 2008 = .18=18%

Starbuck Corporation total net income for 2009 (in millions) = $559.2

Starbucks Corporation total shareholders equity for 2009 (in millions) = $3,045.7

Return on Equity (ROE) ratio for 2009 = .18= 18%

A return on equity of 18% signifies that the company generates $18 of earnings for every $100 that has been invested by the Starbucks Corporation shareholders. The Days' Receivables Ratio is calculated by dividing the number of days in a year, 365, by the Receivables Turnover Ratio. Measuring a companys efficiency in the use of its assets is an essential business aspect to all of the shareholders involved. The quality and speed of a company in protracting credit and collecting debt can be measured by using the receivable turnover ratio. Therefore, the Days' Receivables indicates the average length of time a company takes to collect on the credit sales to customers (Keown et al., 2005).Average collection period (days receivable) = accounts receivable/annual credit sales/365Starbucks Corporation Accounts receivable 2008 (in millions) = 329.5Starbucks Corporation Annual credit sales (net revenues in millions) 2008 = 10,383.0Starbucks Corporation Days Receivable for 2008 = 11.6 daysStarbucks Corporation Accounts receivable 2008 (in millions) =271.0Starbucks Corporation Annual credit sales (net revenues in millions) 2008 = 9,774.6Starbucks Corporation Days Receivable for 2009 = 10.1 daysThe Days Receivable compared is about the same for each year. The 2009 year seems to have found a better method to receiving funds on credit sales. From the information presented herein, it is obvious that, Starbucks has put in place a complete and comprehensive set of policies. Adherence to these policies is expected of all employees of the Company. Additional safeguards and separate monitoring procedures have been designed and implemented in aim of providing the investors with accurate evaluation and oversight of financial health of the company. By combining the internal controls and the external monitors, Starbucks has been able to comply with the SEC and other governmental agencies thus providing the investors of the company a viable, profitable company to invest in.

ReferencesInvestor Glossary (2010), Current Ratio. Retrieved August 28, 2010 from http://www.investorglossary.com/current-ratio.htmKeown, A. J., Martin, J. D., Petty, J. W., & Scott, D. F. (2005). Financial Management: Principles and Applications (10th ed.). Upper Saddle River , NJ: Pearson/Prentice Hall.Moyer, C., McGuigan, J. & Rao, R (2007), Fundamentals of Contemporary Financial Management (2nd ed.), Thomson Learning: South Western Starbucks Corporation (2008), Annual Report. Retrieved August 28, 2010 from http://www.starbucks.com/about-us/company-information/corporate-governanceStarbucks Corporation (2009), Annual Report. Retrieved August 28, 2010 from http://www.starbucks.com/about-us/company-information/corporate-governance Starbucks (different)

Ethics and Compliance PaperIn todays society several people enjoy sharing coffee with family and friends in a nice quite environment. A romantic environment is what Moby Dick had in mind when he came up with the name Starbucks. In 1971 the first Starbucks was opened, it was a dingle store in Seattles historic Pike Place Market. Starbucks was a narrow storefront that offered some of the worlds finest fresh-roasted whole bean coffees. Over the years Starbucks has grown into one of the worlds most popular coffeehouses. Starbucks is very popular among college students, often time lots of college students will go to Starbucks to write papers, study etc. as they drink hot coffee and all of the other things that Starbucks have to offer on the menu. Starbucks mission is to inspire and nurture the human-spirit one person, one cup and one neighborhood at a time.Within the Starbucks organization there are procedures in place to ensure ethical behavior is being performed. In the Starbucks organization there is a business ethics and compliance guideline that is available for the partners and employees to follow. Starbucks believe that conducting business in an ethical manner is vital to the success of the company (Starbucks.com). Ethics is defined by Webster as the principles of honor and morality, accepted rules of conduct and moral principles of an individual (Webster, 2011). The business and compliance program supports the Starbucks mission statement and also helps to protect Starbucks culture and reputation by providing resources to help employees make ethical decisions (Starbucks.com).Ethics has a lot to do with the financial environment within an organization. If an organization has poor ethical skills it could lead to fewer customers which mean fewer profits. The authors were asked to explain the financial market in the United States. We believe to be able to explain it; one must have an understanding of the market. According to Titman, Martin, and Keown (2011) a financial market is any place where money and credit are exchanged. When you take out a car loan from your bank, you participate in the financial markets. Within the financial markets there are three principal sets of players that interact. The three basic principles of financial marketing are savers, borrowers, and intermediaries. The one thing that is well known, without borrowers, savers and financial institutions what we refer to as banks the financial market could not work. Savers or investors are people that always put a little money aside for rainy days. Borrowers are like most people or companies that need money for buying a new home or business or making improvements to one or the other. Intermediaries better known as a commercial bank for example Wells Fargo, Bank Of America, and Fifth/third Bank just to name a few. These financial institutes try to match the right investor with the right borrower. The way that these institutes do this is by using the money that you have deposited in to an account. All in all The financial markets facilitate the movement of money from savers, who tend to be individuals, to borrowers, who tend to be businesses. In return for the use of the savers money, borrowers provide the savers with a return on their investment (Titman, Martin, & Keown, 2011).Starbucks believes that conducting business ethically and striving to do the right thing are vital to the success of the company. Business Ethics and Compliance is a program that supports the Starbucks mission and helps protect our culture and our reputation by providing resources that help partners make ethical decisions at work (www.starbucks.com,). Starbucks code of conduct facilitates legal compliance and ethics training; investigates sensitive issues such as potential conflicts of interest; and provides additional channels for partners to voice concerns. Partners are encouraged to report all types of issues or concerns to the program through their choice of the offered communication channel (www.starbucks.com). According to Business Ethics (2009) our mission is to inspire and nurture the human spirit- one person, one cup, and one neighborhood at a time. As this team has reads through Starbucks standard business code of conduct they find out that the fundamental success of the company is managed by the willpower to do the right thing. Starbucks ethics and compliance program is there to support the companys objectives, cultures by assisting their partners to do the right thing in the work place. If at any time on matter where you are you have a list of contacts that one can call to get answers from the resource partners.The members of this team through research and calculations evaluated Starbucks organizations financial performance during the past 2 years, using financial ratios. Here are the calculations of the ratios for each year:2011 2010o Current 1.8 1.5o Debt 0.13 0.15o Return on equity 6.31 5.16o Days receivable 34.0 37.3

Discuss the trend for each ratio and what it tells you about the organizations financial health. With the increase of the Current Ratio, the business as a whole seems to be increasing their overall profit; in short the business is bringing in more money. Their Debt ratio has decreased over the year, thus increasing the profit is bring in. the business as a whole is spending less money and bringing more in, forming a solid profit. Overall what started as a small business is turning into a formidable one, with their expansion of products and company presence and the data provided one can see Starbucks continuous growth for the next year? As the authors prepared their information on the Starbucks Company they learned how the company operates on a day to day base, and what steps are in place for each partner to follow according to SEC regulations. They also came to unmans decision that Starbuck will be in business for a very long time.

ReferencesBusiness Ethics. (2009). Retrieved from http://assets.starbucks.com/assets/sobc-fy09-eng.pdf Starbucks. Retrieved from http://www.starbucks.com Webster Dictionary, 2011 DisneyEthics and Compliance PaperFinancial RatiosCurrent RatioCurrent ratio is the ratio between current assets and current liabilities (Current Ratio, 2009). Current ratio signifies how much amount of current assets is available to disburse for the current liabilities. The current ratio of Disney for the year 2007 is 0.99 and for the year 2008 is 1.01. The current ratio of Disney is does not show good signs of liquidity management. Even though the Disney has improved the current ratio from the year 2007 to 2008, the current ratio is still well below the standard requirement of 2:1.DebtDebt to total assets: The ratio of debt to total assets illustrates the percentage of total debt to the total assets of the company (Total Debt to Total Assets, 2009, p. 1). The outstanding amount is shareholders net worth. The debt to equity ratio is vaguely decreased from the year 2007 to 2008 which is the good sign. Return on equityReturn on equity ratio shows how much each rupee invested by the shareholders has yielded the revenue. The return on equity has been decreased from the year 2007(15.2%) to 2008 (13.7%). The return on equity needs to be compared with other companies in the same industry. If the return on equity is higher than other companies, then the share price will be elevated and the company can command a premium price for stocks because of goodwill the company has earned in the marketplace. If the return on equity is less than industry average, then the stock price in the market will fall. Days receivableThis ratio shows the number of days the company will need to collect the monies from customers. If the ratio is low, then days receivable indicates that the company is able to collect the monies in fewer days. Disney has increased the days from 61 to 62 days. Disney needs to take particular efforts to decrease the receivables to evade the needless locking of companys funds in the hands of debtors.

ReferencesCurrent Ratio (2009). In Investopedia ULC (p.2)Total Debt to Total Assets (2009). In Investopedia ULC (p. 1