Metaluna,Inc

question 77

Essay

Metaluna,Inc.,is a new software company that recently began operations in 2003.Metaluna's stock is publicly traded.Listed below are several statements made recently by the CEO and Chairman of the Board of Metaluna at a directors meeting.
Required: Please comment on each statement in light of the requirements imposed by the Sarbanes-Oxley Act (SOA)of 2002.
a."I would like our external auditors to have a major role in our financial systems design and implementation in the future.They seem like a good group of knowledgeable individuals who I believe can help us in this area."
b."As you know,our controller resigned from her position this week.I would like to see if someone from the auditing firm who worked on our most recent audit would be interested in coming 'on board' with us."
c."I am ready to approve a $20,000 company loan to our CIO to help him send his daughter to Stanford in the fall."
d."The audit committee has suggested that a new auditing firm be hired after completion of our current audit.I would like the board to make a resolution giving me sole discretion and authorization in this matter,since I believe I am better qualified to make such a decision."

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Definitions:

Direct Channels

Routes through which a company sells its products directly to its customers without any intermediaries involved.

Dual Distribution

The use of two or more channels to distribute the same product to the same target market.

Distribution Channels

Pathways through which a company delivers its products or services to customers.

Intermediary

An entity or person that acts as a middleman or agent between two parties in a transaction or process to facilitate the transaction.