+1 862 207 3288 1. Explain the function of the audit committee, and describe why it is important that it consist of outside (nonmanagement) directors.
2. One of the factors contributing to the 2008–2009 recession was the unwillingness of commercial banks to extend loans to customers, some of whom were quite creditworthy. This unwillingness led to what was called a “credit crunch.” Discuss reasons why banks would become reluctant to extend credit to customers, and how the financial reporting system represents these loans on the banks’ financial statements.
