Title: Hitachi, Ltd.
The learning goals of this assignment are to gain a greater understanding of assertions, internal controls over financial reporting at both the entity level and the process level, and to contemplate both the auditors' and regulators' roles in identification of illegal activities. To complete this assignment you will need to read the September 28, 2015 SEC complaint, obtain additional information about the company and the matters discussed in the complaint, and critically apply your understanding of various topics discussed throughout this course.
The requirements of this assignment are to answer the five questions listed below. I have listed a few sources below which should be helpful. You may use any other sources you identify, as long as you cite your source. As the case in question is real, additional information can (and should) be found online related to this case (and the matters discussed herein).
(1) List at least 3 of managements assertions that were violated (per the SEC complaint).
(2) Suppose you were hired by Hitachi, Ltd. as a consultant to recommend internal control policies ?(control activities) and procedures designed to prevent or detect frauds similar to that identified ?at Hitachi. Discuss three internal control recommendations you would make.
The SEC's complaint against Hitachi Ltd:
Hitachi, Ltd. annual financial statements filed with the SEC for the period in question:
As a foreign filer, Hitachi filed form 20-F with the SEC. Here is an example of their annual report for the year:
Hitachi Ltd.'s listing of all SEC Edgar filings