Obtain a copy of the organization’s annual report and SEC filings for the past 2 years.
Prepare a 1,400- to 1,750-word paper in which you analyze the data in the annual reports and SEC filings. Address:
* Procedures to ensure Ethical Behavior
The Disney brothers started the company back in 1923; in 1928, the brothers produced their first cartoon movie. In 1937, the company came out with their first animated movie “Snow White and Dwarves, three years later, in 1940, the company went public from that moment on the company expended in producing many classic animated films ("The Walt Disney Company", 2011). The company’s focus is not on generating massive wealth alone, but on ...view middle of the document...
D) The committee is to keep the Management Audit department accountable in effective discharge of its responsibilities. E) The committee must establish procedures for complaints received regarding accounting and confidentiality of anonymous submissions regarding questionable accounting matters. F) The committee is to prepare annual financial report for the annual meeting of stakeholders ("Charter Of The Audit Committee Of The Board Of Directors", 2009).
Compliance of SEC Regulations
In 2004, Disney was charged with violating the Securities and Exchange Commission disclosure agreements by failing to disclose financial dealings between the company and its directors (U.S. Securities and Exchange Commission, 2004). Children of Disney directors were receiving a substantial amount of money with the minimum amount being $60,000.00 to exceeding $150,000.00 in a year (U.S. Securities and Exchange Commission, 2004). In order for Disney to comply with the SEC regulations, Disney needed to modify the code of business conduct for the directors.
Disney, to prevent these issues from occurring, put in place four regulations that the directors must follow (Walt Disney Company, n.d.). First, the directors must represent the shareholders interests of Disney (Walt Disney Company, n.d.). Second, directors must have the highest standard of commitment and honesty of their judgments that they are making (Walt Disney Company, n.d.). The third code is to ensure the director dedicates enough time and attention to their duties; and lastly, the directors are to abide by the provisions within the code (Walt Disney Company, n.d.). In addition, the directors need to follow the conflict of interest section, which states that if Disney employs their family members, they shall not receive any benefits with the position they hold. Other areas that help Disney function in accordance to the SEC are business relationships with directors, the use of Disney information concerning assets, confidentiality, obedience to the laws, fair dealing, accountability, and waivers (Walt Disney Company, n.d.). All the sections of the code help create a guideline in which Disney will not be put in the same predicament they were faced with in 2004.
* Evaluation of Disney’s Financial Performance
Current ratio can be defined as an indication of a company’s ability to meet its short-term debt obligations. This ratio can be calculated by dividing the current assets by the current liabilities. According the investorwords.com (2011), the higher the ratio, the more liquid the organization is. Generally, if the current assets of a company are more than twice the current liabilities then the company could be considered financially sound and able to meet their current obligations. However, if the current liabilities exceed current assets, then the company may have issues meeting their financial obligations (Investorwords.com).
Disney’s 2010 10-K SEC filing noted current assets of...