ipl-logo

Pros And Cons Of Poor Accounting

1767 Words8 Pages

Responsibility for Poor Accounting: Are Accountants Always To Blame? Accounting is the process of “analyzing, recording and summarizing” financial information into useful and reliable financial statements that would serve as an overview of the business’ financial performance to both internal and external users. Accountants are the people who deal with this as a career, that is, to professionally maintain a business’ accounts up-to-date. It’s easier to put the process into words than to execute it. And that’s the reason why it takes a long time for an accountant to acquire the needed experience and to achieve a level of trust and professionalism in the eyes of the business’ management. However, instances of poor accounting may take place. And in most cases, such instances result in monetary losses for a business. Monetary losses and poor accounting are often blamed upon accountants (alongside managers or solely) but based on detailed observation several reasons prove the contrary and are mainly related to the internal management. …show more content…

Managers are usually in charge of taking all the needed and right decisions for a business. Some of the managers’ tasks include choosing the right financial accounting method, risk assessment, and monitoring activities. One of the cases that show how management controls are important and how bad it affects the business when it’s wrong is the Toshiba scandal that came up in 2015 where the management decisions were never questioned by the employees (accountants included) and this resulted in an overstatement in the company’s earnings for seven years. Another less known incident mentioned in a news article by the Washington Examiner was a theft case in the US Embassy in Tbilisi, Georgia where poor security controls led an employee (now a former employee) to steal $160K over a period of four years (2010 to 2014) and eventually get away with it (Joel Gehrke,

Show More
Related

  • Sarbanes-Stanley Case

    950 Words  | 4 Pages

    From what this case turns out to be, as determined by the facts surrounding it, if our organization was set up such that our supervisors have the power to fire employees under their supervision, the company could have potentially found its entangled in a Sarbanes-Oxley lawsuit. There is no doubt that had this morally upright secretary been fired for standing her ground in the face of our rogue supervisor 's demand for her to cook the books the company could have been in violation not only for attempting to file a fraudulent expense account but for taking retaliatory action against her for refusing to do such. On the other hand had the secretary connived with her boss, the supervisor and prepared the false expense report, the company 's reputation could have again been in violation of the Sarbanes-Oxley Act. A federal law that prohibits publicly traded companies such as ours, in engaging in fraudulence accounting and financial practices. Such a scenario could have ruined the corporation 's reputation and expose it to an enormous fine from the Federal Trade Commission.

    Read More

  • Xacc/280 Week 4 Case Study Of Managerial Accounting

    520 Words  | 3 Pages

    Amerah alhajri 120016323 Q1 1-clear up assignment reason. on the off chance that the intention is to rouse the utilization of the administrations of a recently framed division, maybe no expenses ought to be dispensed in the event that the reason for existing is to dishearten working division directors from over-utilization of the administrations of bolster offices, then a rate for every unit of administration may be substantial and not in light of genuine expenses on the off chance that the reason for existing is to decide the full cost of items or administrations for long haul estimating choices, then all bolster expenses ought to be assigned 2-recognize cost pools. the reason will figure out if both settled and variable bolster division expenses ought to be dispensed the reason will figure out which expenses ought to be designated Q2 1-physical output. >> 2- market based.>> a-

    Read More

  • Office Space And Fraud

    676 Words  | 3 Pages

    A great example of fraud was when Peter and the two employees hacked the corporate system in order to transfer money to their personal accounts. Moreover, theft is executed when they stole the copier machine with the only intention to destruct it. These types of frauds have been considered misappropriation of assets since both, the money and the copier machine, were counted as a part of the company assets and they as employees of the IT company abuse of their job positions to benefit their personal needs through the omission of fraudulent

    Read More

  • The Pros And Cons Of Forensic Accounting

    810 Words  | 4 Pages

    Forensic Accounting: Dr. Larry Crumbly (2017) sees forensic accounting as a specialty area of accounting that describes engagements that result from actual or anticipated disputes or litigations. In general terms, it is a practice that invites use of accounting skills to investigate fraud and malpractices in the corporate space and bureaucracies, and analyze information drawn from such investigations for the purposes of use in legal proceedings. According to the Forensic CPA Society, there are numerous types of forensic accounting engagements especially when it comes to civil litigations and disputes. These engagements include: Calculating and quantifying losses and economic damages, whether suffered as a consequence of extortion and/or breach

    Read More

  • Organized Crime Control Act Case Study

    697 Words  | 3 Pages

    (Lippman) The implications here would include the need to conduct a proper investigation and gather the essential evidence need to convict those responsible for the unlawful activity. Also the fact that the accused would most likely be lower level employees and associates that would insist that higher level management was in charge of everything. An example of this would be the eleven defendants accused of obtaining and maintain lucrative contracts for Access Health Source.

    Read More

  • Professional Scepticism In Auditing

    860 Words  | 4 Pages

    The unrealistic expectations of external users of financial statements to assume that an auditor remains totally impartial to client influence is a conclusion drawn from psychological research. The legal system forms the opposite view and has determined that external users should be able to rely implicitly on an auditor’s determination. Accounting standards have set expectations of auditor independence and neutrality. (Max H. Bazerman, 1997) The entire concept of professional scepticism and its application is the true and fair representation of financial statements to the users of these

    Read More

  • Examples Of Unethical Behavior In Business

    1191 Words  | 5 Pages

    A) Introduction Unethical behaviors in business affect everyone since you either work in the field or are a consumer of its services. Unfortunately, almost every company usually has individuals who act unethically whether it is for their personal benefit or for the sake of the company they work for. Unethical behaviors in business might be as simple as using company property or funds for personal gain to inside trading and financial fraud. According to The Chartered Institute of Management Accountants, nearly one third of business professionals feel pressured to compromise their ethical standards and are increasingly pushed towards unethical behavior. Moreover, “misconduct is common and accepted by business services professionals, the integrity of entire economic systems is at risk”, states Jordan A. Thomas, partner and chair of the Whistleblower Representation Practice at Labaton Sucharow law firm.

    Read More

  • Whistleblower Protection Essay

    2272 Words  | 10 Pages

    Abstract Whistleblowing has now became an important aspect to organizations and it reflects governance aspect of the organization. This paper explains problems faced by Whistleblowers over the world. This paper also deals with the legislations on whistleblower protection in India and why some countries are hesitating to introduce whistleblower protection law. It deals with reasons for such hesitations.

    Read More

  • Ethics And Moral Issues In The Enron Scandal

    931 Words  | 4 Pages

    (Johnson , 2014 ) In this case , it shows that under normal circumstances the management level of a company or corporation will choose to hide the truth over honesty and integrity .In other way , profitability has override the important of ethics in the corporation .

    Read More

  • The Role Of Fraud In Accounting

    1594 Words  | 7 Pages

    Fraud is defined as “the intentional deception made for personal and monetary gain” (Hill, 2005). Many people think think of fraud as making an illegal ID or forging papers. Another type of fraud that often goes unnoticed to the untrained eye is unethical accounting, also known as accounting fraud or ‘Cooking the books”. Accounting scandals are complex and can be very tricky to locate even under close inspection of a company’s accounting records. Accounting relies heavily upon numbers balancing each other out.

    Read More

  • The Importance Of Accounting In Personal Finance

    748 Words  | 3 Pages

    According to Averkamp (2016), “accounting is the recording of financial transactions plus storing, sorting, retrieving, summarizing, and presenting information in various reports and analyses”. Therefore knowing how to carry out these tasks

    Read More

  • The Importance Of Accounting History As An Academic Discipline

    1108 Words  | 5 Pages

    It is this that justifies accounting history as a crucially important academic discipline. “History, in itself is instinctive and indigenous to all of us” (Carnegie. et al, 2011), whether individuals know it or not, everyone’s decision making process is strongly based on past experiences, and the past is the key source resorted to whenever a decision is needed to be made. The same is applicable to accounting, the decisions made today in all practices and approaches are drawn from the historical developments in the accounting process, that have led the practice

    Read More

  • Ethical Issues In Accounting

    1710 Words  | 7 Pages

    It is easy for those accountants that are unethical to alter the financial records of a company. This makes the company seem to be doing well in the short term, but in the long run, it leads to failure of the company. The other ethical issue is a falsification of documents. Falsification of documents involves changing the details of the documents which are original so that they can appear real ( Bampton and Cowton, 2013, p.552).this is done with the aim of deceiving another person. Some of the documents that are easily falsified are personal checks, tax returns, bank accounts records and birth certificates among others.

    Read More

  • Importance Of Accounting Information System

    925 Words  | 4 Pages

    The main important purpose of the accounting information system is to promote the activity of the enterprise and to form a reliable and real picture of it. In addition, the accounting information system promotes the activity of the enterprise effectively by preparing up-to-date information statements, providing as much information as possible so that the data should be understandable all users not only for the experts(bookkeepers) and tracking liquidity. Nowadays accounting software is a programme which makes accounting work processes easier and faster and which makes it possible to meet the information demand of the management. It also can support the accountants’ work, helping to compile reports by in helping to compile reports by recording and processing the events concerning the

    Read More

  • Literature Review On Unethical Behavior

    2877 Words  | 12 Pages

    Review of Literature Unethical behavior can tarnish a company’s image and reputation. If a company is unethical, they may have to spend additional money to improve their public image, as well as gain back as many customers as possible. The reason I have chosen to use articles that are quite a few years old and that are not so recent is because I feel that they are very good examples of what I am trying to prove in the terms of ethical behaviour within companies and these specific articles relate well to my chosen topic.

    Read More

More about Pros And Cons Of Poor Accounting

Open Document