Particularly Earned Value Management has been used to estimate cost and time to complete, identify cost and schedule impacts of known problems, accurately portray the cost status of a project, trace problems to their sources, portray the schedule status of a project, provide timely information on projects and identify problem areas not previously recognized (Kim and Duffey 2003). The description and derivation of Earned Value Management elements have been comprehensively described in many sources. (PMI, 2005) classifies the terminology into two categories: key parameters of Earned Value Management including Planned Value, Earned Value and Actual Cost and Earned Value Management measures (variances, indices and forecasts). Additionally the evolution of Earned Value Management concepts raised
This essay will view how and why managers choose reporting methods to mask the firm’s performance mostly when they are unable to beat the benchmark. Earnings management is a technique used by companies to control the earnings to be able to reach preset targets while reducing their losses. Earnings management is
It can be weekly, monthly or even daily. The values within the report are generally forecasted. As mentioned before financial accounting information is mainly for the outside people of the company. It is published once in a year and consists of factual and predicted values for those who are interested in investments. The management accounting information are used for further decision making like the report of sales forecasting, budget analysis and comparative analysis, feasibility studies and reports for merger and consolidation.
Conclusion The objective of an annual report is to communicate timely, reliable and relevant information, inform and announce the company’s achievements and performance of the year. The annual report comprises information about the company. The primary purpose of the annual report is accountability. Mr. Tan Hock Yew emphasized that the most important in the annual report is the chairman’s statement. It was the most essential element in the annual report read by most private shareholders.
Understanding Aggressive earnings management This is a process in which a company firstly estimates their financial position, and then works backwards in order to achieve these desired figures Aggressive earnings management refers to using accounting policies and stretching judgments of what is acceptable to present corporate performance in a more favorable light than the underlying reality. Aggressive earnings management also refers to any accounting practice that is technically correct but deviates from how accounting policies were intended to be used. It capitalizes on the loopholes in general accounting principles in order to disguise financial performance. There are many times when companies adopt aggressive accounting practices including selection of inappropriate accounting policies and / or unduly stretching judgements as to what is acceptable when forming accounting estimates. These aggressive earnings management practices, while presenting the financial performance of companies, in favorable position, do not reflect the underlying reality.
Furthermore, the summary report of the income statement, cash flow statement, and balance sheet clearly show one’s personal financial status paving the way for better managing personal finance. Describe the three products of accounting and bookkeeping procedures that are most useful in personal financial planning. In personal financial planning, the three products of accounting and bookkeeping procedures that are most useful are the; income statement, cash flow statement, and the balance sheet. Income statement: The income statement summarizes income and expenses for a period, and also shows the
As some managers are paid partly based on the level of profits earned, therefore they tend to manipulate firm's earnings in order to smooth their remuneration. At the same time, some of the managers who get involved in earnings management is because of their personal satisfaction but most of them are concerned about their job
The paper will calculate the financial ratios of company that will be interpreted with the implications of ratios. Moreover, the paper will describe the indicators of fraudulent reporting. Discussion Purpose of Income Statement It is also called profit and loss statement or income or expense statement. The main purpose of income statement is to indicate managers and investors whether the organisation was cost-effective
EXECUTIVE SUMMARY The main purpose of this project study is to identify the level of financial discipline of the company. The objective is to know the level of cost structure of the company, the level of income and expenditure and there by helps the company to know on what way the company is working. This study has been prepared by using the primary as well as secondary sources of information. The chief focus of the study is based on evaluating the financial performance of a company, identifying how the company is actually working and whether the actual performances are in accordance with the standard performance and in case of any deviations the purpose is to find suitable solution to overcome from the deviations. This study has prepared