Bell South Case Study

            ) Assess the audit committee activity described for BellSouth Corporation considering the Good Practice Guidelines for the Audit Committee in Exhibit 1.
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             From reading the case, I would say that BellSouth Corporation did not entirely adhere to the Good Practice Guidelines for the Audit Committee in Exhibit 1. The committees formed by BellSouth were given an "Audit Committee Reference Binder" which contained the background information about the company. This allowed for better understanding of the business and allowed them to be "informed and vigilant". However, I do not see that they set forth a written charter detailing the committee's duties and responsibilities. Despite the lack of this written charter, they did have the necessary resources and authority to carry out their responsibilities. Another problem is that not all of the directors appointed to the committee were independents. Some of them were from BellSouth Corporation and others were from BellSouth Enterprises. This could create a conflict of interest. .
             The audit committees did keep an open line of communication with management, the independent accountants, and the director of internal auditing. They conducted meetings at appropriate and sufficient intervals to review all necessary information. The committees were composed of enough people as there were more than 3 individuals on each committee. However, I did not see where it mentioned the length of their appointment. If it is less than a year term, that could be a problem.
             2.) Evaluate the Audit Committee Chairman's letter for BellSouth Corporation for 1992 in relation to COSO and Legislative guidelines.
             In looking at the COSO guidelines, the Audit Committee Chairman's letter covers several of these guidelines. COSO guidelines concentrate on the need for top management and the audit committee to communicate their respective responsibilities to financial statement users.