You will be looking at Pepsico Inc and Coca Cola Co for the fiscal year ended 2015 and completing a variety of analysis on both of these companies....

You will be looking at Pepsico Inc and Coca Cola Co for the fiscal year ended 2015 and completing a variety of analysis on both of these companies.  You will specifically be using:

• Pepsico Inc 2015 annual report
• Pepsico Inc 2015 10-K
• Pepsico Inc 2015 Def 14A
• CocaCola Co 2015 annual report
• CocaCola Co 2015 2015 10-K
• CocaCola Co 2015 Def 14A

 ANALYSIS REQUIREMENTS:

Part I.

Please address the following questions for both companies:

a. What is the history of these companies, its current business, operating sectors, and reportable segments? What factors affect their profitability and this industry in general?

b. Compare the nature of Pepsi's history, business sectors, and reportable segments to those of CocaCola's history?

c.  What is the purpose of the Form Def 14A? What does "Def" stand for?  What types of information does a proxy contain?

d.  Who is the auditor for Pepsico?  Who is the auditor for CocaCola?  What were the audit fees as a percentage of (1) total revenue, and (2) total assets?  Audit fees were not always publicly disclosed.  In fact, such disclosure became mandatory only since the year 2000 in the United States.  Why is public disclosure of audit and other fees paid to the audit firm important?

e.  Both managements comment on the fact that internal control over financial reporting has "inherent limitations."  What are those inherent limitations?  How does management obtain comfort that internal control does not contain any material weaknesses?

f.  Go to the Coca Cola website.  Go to the investors section and corporate governance and then "learn more about governance and ethics".  Under Ethics and Compliance, locate the "Code of Business Conduct" and review this.  What are the main components of this code?  Provide a critique of the components and overall message contained in the code.  What guidelines are provided as to how deviations from the company's code of ethics are handled?