Description: There’s a saying that any publicity is good publicity, but i’m not so sure it applies in this case. The giant food manufacturer agreed to a $62 million settlement with the Securities and Exchange Commission (SEC) as a result of Kraft-Heinz’s failure to properly account for certain expenses in its financial statements. Kraft-Heinz has had to restate several years of financial statements to correct its financial reporting. The SEC found fault with the Kraft-Heinz system of internal control, and these weaknesses caused personnel to overlook the accounting errors.
Date: September 3, 2021
1) Do you have any Kraft-Heinz products in your kitchen? Which ones?
2) Does a story like this have any influence on which products you choose to purchase?
3) Chapter 7 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses the five primary components on pages 7-2 and 7-3. Which of these components do you think may have been in play in the Kraft-Heinz situation?