The nature, incidence and ethical issues of creative...

The nature, incidence and ethical issues of creative accounting 1.1 Introduction Creative accounting is also called â€Å"Earnings management† which is known as the manipulation of financial information. The term can be defined in many ways. Initially we define it as a process whereby accountants use their knowledge of accounting rules to manipulate the figures reported in the accounts of a business (Naser, 1993, p.59). Creative accounting, at root, is the origin of numerous accounting frauds. Many accounting scandal cases (like the scandals in Enron, WorldCom, and other firms) in the past few years had happened with the result of collapse. Most of these scandals were conducted by the senior management of organisations and many victims†¦show more content†¦Therefore, managers or directors mean to depict good performance and position by manipulating figures hence in such way the stakeholders will be shown positive indicators from the financial statements. By this way, investors will more likely to be attracted and given confidence with this superb financial report. This can be achieved by modifying the figures in the statements using the tricks of creative accounting. In addition, how many bonuses directors will receive in a year may base on the percentage of the profit reported (Shafren, 2009). For this reason of their private interest, directors may manipulate financial figures to meet the ir desire. Lttner, Larcker and Rajan (1997) have the same perspective. They illustrate that when the directors or managers private interest (such as stock options and bonuses) is rely on the performance of the company, they are more likely to use creative accounting to manipulate the figures in order to achieve their favourable results. Another motivation of creative accounting is the positive effect that the income smoothing brings to the valuation of security and reduces the risk for the analyst. â€Å"Where management observes a gap between analysts’ expectation and the actual performance of the company and when major capital market transactions are being expected†Show MoreRelatedThe Failure Of The External Audit Function2628 Words   |  11 PagesQ1 Accounting firms have evolved during the last three decades to the point where they become so diversified and generated more earnings as opposed to what they have traditionally offered in basic services. This development carried their culture toward profit maximization and cost efficiency, they started to operate similar to every other business where competition and customer satisfaction and retention are paramount. 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The Global Financial Crisis 0f 2008 - 1181 Words

The Global Financial Crisis of 2008-2008: The Role of Greed, Fear, and Oligarchs The global financial crisis of 2008-2009 is considered to be worst financial crisis since the Great Depression of the 1930s. Large financial institutions collapsed, banks received bailouts by the government, and stock markets plummeted as well. In result, people were being denied loans. The housing market became a problem because of financial issues and many people were unable to continue to pay their mortgages which resulted in evictions and foreclosures. Sellers’ homes’ remained on the market and were unable to be sold. There was an extreme amount of supply, but not enough demand. Major businesses also failed, and millions of people lost their†¦show more content†¦Mortgage-backed securities and credit default swaps (CDS) were two types of derivatives that became noticeable during the housing boom. CDS were contracts that were similar to insurance policies which were typically for municipal bonds, corporate debt and mortgage securities that assured people that they would offer coverage for certain securities in the event of default. For this reason, CDS was extremely popular. The close ties between Washington and Wall Street contributed to the financial crisis as well. There were enormous financial contributions from Wall Street to the political campaigns for constituents which contributed to this relationship. As far as â€Å"influx† of new money, as the US banking regulations was easing, other countries were experiencing a boom and looking for somewhere to invest. So who is to be blamed for this financial crisis and the problem with the housing market? Was it the government? Was it the banks? Was it Politicians? The blame was a global discussion during this time. Amongst others playing a role included: †¢ mortgage lenders †¢ credit rating agencies †¢ insurance companies †¢ regulators †¢ governments sponsored entities †¢ investors †¢ homeowners Many also believed that those working in theShow MoreRelatedFactors That Affects The Global Economy And Its Impact On The Nigeria And Egypt Economy1568 Words   |  7 Pagesthe factors that affects the global economy and their impact on the Nigeria and Egypt economy. In 2007, the financial crisis, which later extended to the global financial crisis began in the United States of America. The origin and elements of the 2007/2012 global financial crisis have been widely discussed in the literature throughout the period. The aim of this work is to, however, try to point out the reasons and also the macroeconomic effects of the financial crisis in both countries economy andRead MoreThe Causes and Effects of a Recession Essay2728 Words   |  11 Pagesincreased bankruptcies. In UK, recession is when there is negative economic growth for consecutively two quarters which is measured by Real Gross domestic product.GDP is standard measure of total value of county’s output of goods and services. The recent 2008/2009 recession is said to be a â€Å"Great Recession† by many authors. According to Office for National Statistics (2013a) previous recessions (post-war) were recovered quickly; maximum time was almost 13 quarters (1980s) to reach the pre-downturn peakRead MoreStrategic Analysis Burberry4740 Words   |  19 Pages The Strategic Position 6 2.1. Macro-Environment 6 2.2. Industry and market structure and competitive conditions 7 2.3. Strategic capability, Resources and Competences 8 2.3.1. Strategic capability 9 2.3.2. Resources 9 2.3.3. Competences 9 2.4. Financial situation of Burberry 9 3. Strategic choice 10 3.1. Business level strategic choice 11 3.2. Corporate level strategic choice 11 3.3. Direction and methods 11 3.4. Recommendations 13 4. Conclusion 14 5. Appendix 14 6. References 15 1. Recent pastRead MoreStrategic Analysis Burberry4734 Words   |  19 PagesStrategic Position 6 2.1. Macro-Environment 6 2.2. Industry and market structure and competitive conditions 7 2.3. Strategic capability, Resources and Competences 8 2.3.1. Strategic capability 9 2.3.2. Resources 9 2.3.3. Competences 9 2.4. Financial situation of Burberry 9 3. Strategic choice 10 3.1. Business level strategic choice 11 3.2. Corporate level strategic choice 11 3.3. Direction and methods 11 3.4. Recommendations 13 4. Conclusion 14 5. Appendix 14 6. References 15 1. Recent

High School Drop Out Rates Free Essays

High School Drop Out Rates Essay The nation’s dropout crises have become severe over the past ten years. Big city high schools have less than 50% of freshmen graduate. (8) The problem has taken a back seat to a national focus on early childhood and elementary programs. We will write a custom essay sample on High School Drop Out Rates or any similar topic only for you Order Now Recent studies have found the dropout rate rising in large cities. Among minority groups, the dropout rate is the highest. The causes of the growing problem range from teen pregnancy to depression. The effect of the drop out rate is financially devastating on the individuals who dropout. Programs are being used to help decrease the tendencies for student to dropout. The national dropout rate has become common for teenagers. Dropout intervention programs have little effect from keeping teens from dropping out. According to the Boston herald website: But combating dropout rates requires new approaches since one group of researcher found that the 20 primary dropout prevention programs administered by the U. S. department of education made little difference in keeping teens in school. The city’ has gradually increase during the past four years, with roughly 900 student-mostly black and Hispanic- leaving the system each year. (1) This problem has been gradually increasing because schools have focused on basis math, literally skills and early childhood education for raising overall test scores. The dropout problem has been virtually forgotten. According to Jay Smink, Director of the National Dropout Prevention Center at Clemson University: â€Å"The sad part is, no one is seriously looking at the issue, and the sadder part is they’re no t putting the resources needed to improve the graduation rate,†(2) Largest Group of Drop-outs Hispanics are the largest group of dropout rates at 30-35%. This is 2. 5 times higher than the Africans-Americans dropout rate and 3. 5 % time the rate of whites. The study show the reason for the higher rate among Hispanics is poor teacher preparation, lower expectations, and overcrowded facilities. Another reason is a language barrier. Few teachers know enough Spanish to teach Hispanics. Other reasons are cultural related. Many Hispanic youth cite reasons for dropping out that are common to all youth who drop out. These reasons are they are failing, bored and/or having to work to support a family. Most Hispanics tend to believe that the public schools disrespect Hispanic culture, neglect the language problem, and set academic standards below the national norm. Poverty is wide spread among Hispanics. (6) Many children do not get an early start at school by attending pre-school; therefore, these children are at a disadvantage from the start. Their parents cannot read so these children miss being read to which is a necessary part of early development. In addition, peer pressure is an extremely strong influence on Hispanic youth. According to the Augusta Chronicle. How to cite High School Drop Out Rates, Essay examples

Essay about My Dream Job Would Be An Investment Banker Essay Example For Students

Essay about My Dream Job Would Be An Investment Banker Essay My dream job would be to become an Investment Banker, however although the benefits of the job are spectacular so are the drawbacks. Investment Banking is different from Commercial Banking, which is what most people think of when they hear the word bank, commercial banks serve as managers for deposit accounts for businesses and individuals, whereas investment banks speed up the purchase and sales of bonds, stocks and other investments. Investment banking mainly involves â€Å"helping companies and governments issue securities, helping investors purchase securities, managing financial assets, trade securities and providing financial advice† (Careers-in-Investment-Banking, 2011). There are many roles an Investment Banker plays in a company, including saving the company time and money, by figuring out what the risks are that come with any given assignment. An Investment Banker serves as a coordinator between a company and investors when the company is ready to disperse bonds or stocks. They should an expert in their specific market field, as part of their job entails advising others based on the current state of the economy (Investment Banker, 2015). The working conditions of an investment banker is usually described as a nightmare. They tend to work from 10:00 am until 2:00 am on a regular weekday (Joule, 2015). For most investment bankers the hours aren’t the problem, it’s the unpredictability of the work. You seemingly lose control over your life and are perpetually on call, a call that you must answer whatever the hour or holiday. Most bankers find it easier not to plan too far ahead for fear of having to cancel at the last minute due to work (Joule, 2015). Investment Banks are usually located in the financial centers around the wo. . though it seems glamorous from the outside seems to be quite stressful, and a little terrifying. When I first starting looking into Investment Banking, I was appalled at all the negative experiences people had, about it sucks you in and drains the life out of you. But then there were a few encounters that laid out both the bad and the good, and how after a few years of paying your dues, it starts paying off, you begin to realize how far you’ve come as a person and what you have achieved and what a beautiful new work ethic you now have instilled within you. Through this inquiry paper I have found a new possible career path, although I would like to only work a few years in the investment banking world before breaking into the world of Corporate Finance. Which I am hoping will become more understandable due to my background level of experience in Investment Banking.