EASTMAN KODAK
EASTKOD 1
EASTMAN KODAK CASE STUDY
Cathy Jo Biddinger
Advanced Auditing
Professor
June 16, 2013
EASTKOD 2
Eastman Kodak
Evaluating the financial condition of Eastman Kodak can be troublesome. Per my evaluation of their quarterly report which was found at http://www.kodak.com, some red flags have appeared that the auditors should be aware of. These stand out and should have special focus on.
This quarterly report is based on the companies’ business activities as well as their subsidiary companies between the reporting periods of January 1, through December 31, 2011. It has been speculated that some of the previous reports have not been dealing on actual performance data basis (Avery, 2012). While many believe this to be impossible and untrue, however, there seems to be that there were no exceptions reported or noticed on prior reports. Once again, while analyzing this report there seems to be correspondence in regards to data exclusion from the outsourced operations and data for leased facilities were indicated. The cash flow analysis of Kodak has always been cause for concern. The Kodak companies the past several years have had many issues as seem by the financial statements. “The internal cash flows are negative indicating that this company has a financial problem (Arnold, 2012). Items such as the operating costs, investing, and the use of the cash and its outflow when it has cash are what we consider internal cash flows. Kodak company is aimed its focus on funding numerous functions and operations. This funding was to make sure that the IP licensing strategy would a hit. For this to be applicable, the company would have to sell its assets. “Thus in order to be successful in the IP portfolio strategy
EASTKOD 3
Eastman Kodak set there sites aimed at getting funds of over $200 million and then to have licensing transactions
EASTMAN KODAK CASE STUDY
Cathy Jo Biddinger
Advanced Auditing
Professor
June 16, 2013
EASTKOD 2
Eastman Kodak
Evaluating the financial condition of Eastman Kodak can be troublesome. Per my evaluation of their quarterly report which was found at http://www.kodak.com, some red flags have appeared that the auditors should be aware of. These stand out and should have special focus on.
This quarterly report is based on the companies’ business activities as well as their subsidiary companies between the reporting periods of January 1, through December 31, 2011. It has been speculated that some of the previous reports have not been dealing on actual performance data basis (Avery, 2012). While many believe this to be impossible and untrue, however, there seems to be that there were no exceptions reported or noticed on prior reports. Once again, while analyzing this report there seems to be correspondence in regards to data exclusion from the outsourced operations and data for leased facilities were indicated. The cash flow analysis of Kodak has always been cause for concern. The Kodak companies the past several years have had many issues as seem by the financial statements. “The internal cash flows are negative indicating that this company has a financial problem (Arnold, 2012). Items such as the operating costs, investing, and the use of the cash and its outflow when it has cash are what we consider internal cash flows. Kodak company is aimed its focus on funding numerous functions and operations. This funding was to make sure that the IP licensing strategy would a hit. For this to be applicable, the company would have to sell its assets. “Thus in order to be successful in the IP portfolio strategy
EASTKOD 3
Eastman Kodak set there sites aimed at getting funds of over $200 million and then to have licensing transactions