Democrats vs. Republicans Essay Example | Topics and Well Written Essays - 1500 words

Democrats vs. Republicans - Essay Example The Democratic Party is considered a liberal party but has also been described by academics, politicians and even the U.S. general public as progressive and center-left. However, in reality, it is a party with a large and multifaceted ideological divergence and features. The sectors range from the center-right conservative, through the center, classical liberalism, the socio-liberalism, the Social, union sectors, labor, progressive and left (Elder, p.268). Thesis Statement Democrats are the best for the future of the United States and its people. Stage prior to the Civil War Southern Democrats fanatically defended the institution of negro slavery, hence, most Northern Democrats dropped their heads and did not dare to oppose their fellow South, anti-slavery Democrats were unhappy with this party. The Democratic Party and Civil War When Southern states declared their separation from the United States to create an independent country (the Confederate States of America) and took up arms, the Southern Democratic Party became the political force supporting armed rebellion, and made criminals, responsible members of rebellion and treason. The Northern Democratic Party remained loyal to the Constitution and laws, and recognized the government of Lincoln, supporting the use of force to suppress the rebellion. The struggle against racial segregation and civil rights, and the "War on Poverty" President Roosevelt initiated a radical reform program known as the New Deal ("New Deal" to face the chaotic social situation. Roosevelt was a supporter of the free market economy; he was also responsible for the creation of the Minimum Wage in the United States. Moreover, he greatly increased public spending to fund its many programs to alleviate poverty, fight unemployment and stimulate the economy; however, he increased the taxes to achieve this goal (Wattenberg, p.205). When Democrat, John F. Kennedy, won the presidential election of 1960, what he did was to defend something whic h defended all democratic leaders left or right: equality between citizens of any ethnicity.

Reading Responses of Trifles by Susan Glaspell Essay

Reading Responses of Trifles by Susan Glaspell - Essay Example Though I still do not know what Monster’s ball meant, studying the play Trifles for the second consecutive time proved to me that it is different. Apparently, Glaspell’s indirect concentration became evident to me in the second study of the play. Symbolism is an exemplary aspect of the play. The dead bird that Mrs. Peter and Ms. Hale spotted is a symbolism of Foster’s intrinsic demise. The open cage of the bird emblemizes the wife’s new freedom found through the demise of her husband (Bradford). Compared to reality, we apply tangible items to emblemize the intangible ones every other day in life. For instance, a white dove is regularly used to emblemize peace. Moreover, the American flag shows liberty among other symbolism used in contemporary times. Glaspell’s indirect style proves to us that it is nonetheless a worthy style. She discusses the women’s place in the society through the entire play (Bradford). Men, who hold distinctive and respectable titles such as deputy and county sheriff use their time searching for touchable evidence and applying fancy methods to arrive at a solution but to eventually fail in their endeavors. However, the women, who I strongly suspect that they were simple housewives, solve the quandary ingeniously, quietly and cleverly. Notably, the women employ their individual knowledge regarding Minnie Foster to theorize and formulate possible reasons why she would have murdered her husband. Additionally, they apply their off-centered blanket stitching to hypothesize that she was surely nervous regarding something. Moreover, the women who never stepped on the scene of the crime discovered the dead bird, which is concrete evidence to depict and prove the motive why she would have murdered her husband (Bradford). In conclusion, in spite of the numerous great traits in the play Triples, there is an eventual

Examining issues with audit quality

Examining issues with audit quality The major accounting scandals occurred worldwide has brought the focus of public to the audit profession and the audit quality. Enron and WorldCom cases in United States and Parmalat case in Europe are the example of major scandals as a result of the failure of audit services. In Malaysia, the Transmile case which involved around RM530 million of accounting fraud has also addressed the problem about the quality of audit services. These examples of corporate and accounting scandals that happened worldwide have indicated that the audit quality of the audit profession is not at an appropriate and acceptable level. Over years, the audit quality issue has been discussed and debated globally. Several actions have been taken by international and domestic authorized agencies to address the audit quality issue. For example, the government of United States has introduced and enacted the Sarbanes-Oxley Act in 2002 as a response to the audit failure in big major corporations, such as Enron and World Com. In addition, the Center for Audit Quality has been established in United States as one of the steps to enhance the audit quality of audit profession. In Malaysia, the Malaysian Institute of Accountant (MIA) plays a vital role in addressing the audit issue and promoting and enhancing the quality of audit. Generally, the function of auditing is to provide reasonable assurance that the financial statements are prepared and presented in a true and fair view and free from material misstatements. The audit reports and audited financial statements will be widely used by the various groups of stakeholders for decision making. Hence, audit quality is an important factor that affects the credibility of the audited financial statements as perceived by the stakeholders. In other words, high audit quality is necessary criteria to build up stakeholders confidence on the audit profession. According to Gaurav Shah, there are five important steps that should be followed to produce a quality audit. Firstly, auditors should plan the audit thoroughly after clearly understanding the objectives and directions of auditing and clearly define the agenda of audit. Next, auditors should perform the audit procedures according to the scope and goal set in the earlier step and continuous measure the performance of the audit works in order to avoid any unnecessary variances happened during audit process. The third step is to record the result of performance, including any errors and problems and report appropriately the result to the management level. Subsequently, improvements should be made on the audit process by solving any detected problems. Lastly, follow up audit should be conducted for the control purpose to avoid any recurring of problems. 2.0 AUDIT QUALITY In order to understand clearer the concept and evolution of audit quality, we will discuss the definition and dimension of audit quality, the audit quality gaps, the factors that affect the audit quality and the relationship between audit fees and audit quality in this section. 2.1 Definition of Audit Quality There is no specific definition for audit quality in the auditing standards. Generally, people focus on the reliability of the audited financial statements when referring to audit quality. When an audit is said to have high quality, the financial statements are usually free from material misstatements and able to provide reliable information for decision making. Traditionally, audit quality has been defined by DeAngelo (1981) as the market-assessed joint probability that a given auditor will both discover (a) a breach in the clients accounting system and (b) report the breach. Under such definition, there are two main features in audit quality, which are the competence of auditors by possessing necessary knowledge to made correct judgment or discover problems on clients accounting system and the independence of auditors to disclose these problems. On the other hand, the Audit Quality publication by ICAEW in 2002 indicated that audit quality is related to the professional opinion given by auditors based on essential evidences and objective judgments. Hence, it is important to understand clearly what is expected on auditors works to provide an appropriate professional opinion on financial statements in order to achieve high audit quality. 2.2 Dimensions of Audit Quality The AUDITQUAL model According to the AUDITQUAL model by Angus Duff (2004), there were nine different dimensions in assessing audit quality, which were reputation, capability, independence, expertise, experience, responsiveness, empathy, client service and non-audit services. These nine dimensions were closely interrelated to represent the whole picture of audit quality. Besides, these nine dimensions can be grouped into two distinct factors that relating to technical quality and service quality. Technical quality is mainly related to the competence and independence of auditors, such as their technical skills, integrity and ability to express objective judgment and opinion. Hence, the dimensions related to technical quality are reputation, capability, independence, expertise and experience. On the other hand, service quality focuses on issues related to audit clients, such as the additional value-added services provided and the responsiveness to the needs of clients. The dimensions of audit quality under this service quality are responsiveness, client service, non-audit services and empathy. 2.3 Audit Quality Gaps Audit quality and failure had become one of the key issues in the audit profession mainly due to the perception gaps of audit quality. According to Angus Duff (2004), there are totally eight gaps being identified in the audit quality model. These gaps are mainly the different perception of audit quality between different parties, such as the auditors, clients and stakeholders, and regulators. With referring to the diagram above, Gap 1 is the discrepancy between the client expectations and the perception of audit firm on client expectations. Gap 2 represents the difference between client expectations and the quality standards of audit firm. Gap 3 refers to the difference between the quality standards of audit firm and the observed quality on audit. The difference between the promises made about audit quality through external communication and the quality of audit forms Gap 4. All Gap 1 to Gap 4 actually represent the quality differences which happen within the audit firm. On the other hand, Gap 5 represents the client expectations and the clients perception of the audit quality delivered. Gap 6 is the discrepancy between the client expectations on what auditor should attain and what auditor can reasonably be expected to attain. The difference between what auditor can reasonably be expected to attain and the auditors responsibilities as stated in laws and regulations creates Gap 7. Gap 8 is the difference between auditors responsibilities as stated in laws and regulations and the actual performance of auditor. The usually said of audit expectations gap in audit profession is collectively represented by Gap 6 to Gap 8. 2.4 Factors Influencing Audit Quality According to the Audit Quality framework developed by Financial Reporting Council (FRC) of UK in 2008, there are five key drivers that affect the audit quality. These five key drivers are the culture within an audit firm, the personal qualities and skills of audit partners and staff, the effectiveness of audit process, the audit reportings reliability and usefulness, and the factors outside the control of auditors. An audit firms culture is significantly affects the ways of how audit works and processes being performed. A strong and positive culture will directly increase the audit quality of an audit firm. The top management of audit firm should create a positive environment that encourages the audit staff to achieve high quality in audit works. In addition, proper time and resources should be available for every audit works to enhance and maintain the audit quality. Financial considerations should not be the main focus or factor that affects the allocation of time and resources. An appropriate control and monitoring system should be designed and put in place to safeguard the quality of audit too. Audit is a service rather than a product. The quality of audit service may vary when the audit is performed by different people. Hence, human factor is important in determining audit quality. Audit partners and staff should equip with necessary skills, knowledge and professional skepticism in order to provide high quality audit works. It is important for auditors to understand well the environment of the clients business and adhere to the relevant auditing principles and ethical standards. Proper training should be given to auditors to develop their competency and capabilities. The works of junior auditors should always be monitored and reviewed by senior auditors or partners to ensure the quality of audit. The audit process is one of the key drivers to audit quality too. Appropriate audit methodology and tools should be applied in audit according to situation. Audit partners and senior auditors should be always involve in the audit process to provide adequate support and monitor on audit process. In addition, auditors should gather sufficient and relevant audit evidence to support the judgment and conclusion reach throughout the audit process. Proper audit documentation should be put in place too. Furthermore, it is important to consider and maintain the level of independence, objectivity and integrity of auditors in the audit process to ensure the audit quality. The way how an audit being reported will affect the quality of an audit too. Audit reports should be prepared in an appropriate form that follow the guidance of relevant standards. Audit reports shouls be written by using clear language without ambigous words. Proper opinion and conclusion should be provided in audit reports regarding the true and fair views of the financial statements. In addition, proper and clear communication with audit committee is necessary and such action will provide apositive impact on the audit quality. Factors that outside the control of auditors also play an important role in the quality of audit. For example, the corporate governance of an organization is important to enhance the audit quality. An adequate and good corporate governance within an organization directly assists the auditors in performing audit and hence increase the audit quality. The another example of factors outside the auditors control is the role and behaviour of audit committee. An audit committee should always actively address the issues identified throughout the audit process. Other examples of factors outside the control of auditors include the role of shareholders and the audit regulatory environment. 2.5 Audit Quality and Audit Fees Audit quality is something that is intangible and unobservable. Hence, the audit fees are usually used as a proxy for audit quality in many research studies. Generally, there is strong positive relationship between audit fees and audit quality. In order to achieve higher audit quality, it is necessary to conduct more investigation and audit procedures on the financial statements. This resulted in more audit hours and higher audit fees. In addition, the use of more senior auditors and specialized auditors also is required to achieve higher audit quality. This resulted in higher audit fees too. Hence, it can be concluded that higher audit fees should be an indirect evidence to reflect higher audit quality because more resources and efforts has been put in to provide reasonable assurance that financial statements are free from material misstatement. In 2002, the Malaysian Institute of Accountants (MIA) had issued the MIA-By Laws (On Professional Conduct and Ethics) and the laws have provided guidance and recommendation for setting appropriate audit fees. The audit fees should be charged based on the total time spent for particular audit works and the charge-out rate of the related auditors. Therefore, the longer the time spent and the more the number of auditors involved, the higher the audit fees. This should later reflect in higher audit quality. 3.0 AUDIT QUALITY ISSUES Due to the limitation of pages, we will only discuss five audit quality issues in this section, which are inconsistency of audit quality across countries, reduced audit quality practices (RAQP), single audit quality issue, International Standard on Quality Control (ISQC) and the corporate governance issue. 3.1 Inconsistency of Audit Quality across Countries The key element of audit quality is its consistency. The nature and process of an audit should be the same regardless the size of the organizations and the countries where the audit is performed. However, it is a global challenge to maintain the international consistency on audit quality when across countries. The inconsistency of audit quality across countries is mainly due to the national differences in the following aspects (ICAEW, 2010). Political, economic and business environment The characteristics of political, economic and business environment play a significant role on the audit quality of financial statements. The national differences included the corruption and bribery level, the business ethics level, the number and rights of foreign investors and the quality of governance in economic activities. Legal framework Without a formal and complete legal framework, it is difficult to achieve high audit quality. According to the Fundamentals Third Parties published by Audit Quality Forum of ICAEW, it is important to have supportive legal framework for auditors to obtain relevant and reliable information from third parties. The excessive threat of litigation and legal liability can adversely affected the audit quality. Excessive litigation may cause auditors to view standards as rigid rules without proper judgment in their application. In addition, excessive litigation may also prevent the further evolution and innovation in standards and practice. Education Inconsistency of audit quality in different countries may due to the countries education system and their global connectivity level, such as the degree of international communications and relationships. The financial operations and preparation of financial statements should be overview by financially literate person with relevant knowledge, skills and experience so that relevant accounting standards can be applied accurately. On the other hand, auditors should possess adequate and necessary knowledge, skills and experience to carry out works with proper professional judgment and skepticism. Culture According to Hofstede (1980), there were four main dimensions of national culture, which were individualism versus collectivism, strong versus weak uncertainty avoidance, large versus small power distance, and masculinity versus femininity. Different culture between different countries may affect the way a business is operated and certain behaviour to be acceptable or not. For example, Malaysia is a multicultural society where directors of organizations may come from different ethnic backgrounds. The different in ethnic background caused different hold in cultural values. Hence, the directors of organizations may perceive audit quality differently. Perceptions of audit The auditors in different country may perceive audit quality differently due to the length of time over which regulations and systems about accounting and auditing had been developed, and the origins and development of audit service. The motivations of auditors also influence the perceived audit quality too. Several initiatives had been taken to promote the international consistency of audit quality. One of these initiatives is strengthening the adoption of International Standards on Auditing (ISAs) and International Standards on Quality Control (ISQCs) issued by the International Auditing and Assurance Standards Board (IAASB). In addition, national independent audit oversight bodies are established, such as Public Companies Accounting Oversight Board (PCAOB). Besides, national regulators had arranged agreements between countries to rely on each others works. To further encourage the consistency of audit quality across countries, the following four areas of potential action can be considered (ICAEW, 2010). Share experience In order to improving communication and building up necessary skills to achieve consistency and audit quality, it is crucial to share information and experience between auditors on how to build on current practices and potential new use of information technology (IT). This can be done through international exchange and education programmes that expose auditors to new and different environments. Sharing experience and practice is not only limited to audit firms and audit firms networks, it also can happen between national professional accountancy bodies and national regulators and between national and global organizations. Acknowledge national differences International standards should focus more on how national differences may affect audit risk. In addition, standards should have adequate flexibility for auditors to exercise professional judgment to deal with misstatement risks in order to suit with the related national environment. Promote the role of audit The role of audit can be promoted to identify the issues of economic development. When a country facing problems to issue clean audit reports and such problems could not be solved by acknowledging national differences or sharing experience, it gives a sign that there are certain issues need to be resolved, normally related to the political, economic, and business environment or the legal framework. The IAASB standards should be implemented internationally in order to help highlight the national differences and support economic development. Support research Academic research and studies are important in contributing to the consistency in audit quality across countries. Various issues and information are explained clearly in the research papers for better and thorough understanding by others. These issues include the effective ways of sharing experience globally, the acknowledgment of national differences within international standards and the connection between the audit practice and issues of economic development. 3.2 Reduced Audit Quality Practices (RAQP) In the post-Enron era, auditors are said to be working under high pressure condition in the competitive audit market because they are required to perform more audit works but no increase in their audit fees. The behaviours of auditors under such condition directly affect the audit quality and thus rise up an important issue in the auditing profession. Due to the cost-quality conflict and high working pressure, many auditors had engaged in the Reduced Audit Quality Practices (RAQP). According to Herrbach (2001), RAQP can be defined as the poor execution of an audit procedure that reduces the level of evidence gathered for the audit, so that the collected evidence is unreliable, false or inadequate quantitatively or qualitatively. The occurrence of RAQP is considered as normal phenomena in the current audit profession and it does occur in various countries across the world, such as Australia, United States, New Zealand, United Kingdom and Malaysia. Generally, it is important for auditors to identify the factors that lead to RAQP, such as the time budget pressure, in order to understand well the adverse effects of the factors on auditors and audit quality, and hence manage such factors better. In fact, the RAQP has affected the audit quality directly as well as indirectly. Underreporting of time is an example of auditors behaviour that indirectly affects the audit quality. Due to underreporting of time, several problems, such as lack of budget revision and unrecognized time pressure on future audit, arose that will give impact on the audit quality. The RAQP that normally has direct impact on the audit quality are the incomplete implementation of necessary audit programs and procedures in order to complete audit tasks. Such practices include accept weak client explanations or doubtful evidence, premature signing-off, fail to research an accounting principle, reduce the amount of work performed on audit step and so on. (Mohd Nazli et al., 2010) The RAQP is an issue in the audit profession of Malaysia too. It seen that there is an increasing number of auditors engaged in such unprofessional and unethical behaviours and thus giving a negative effect on the audit opinion and audit quality. The weak enforcement by relevant bodies in addressing the RAQP issue is said to be the significant factor that caused the high occurrence of such practices in Malaysia. For example, the Malaysian Institute of Accountant (MIA) is said to be failed in taking appropriate disciplinary actions against delinquent auditors. Furthermore, there were only a little litigation cases against auditors in Malaysia. (Mohd Nazli et al., 2010) 3.3 Single Audit Quality Issue The grants received by state and local governments from the federal government have been increased significantly over years. For example, the grants given by the federal government of United States to its state and local governments had increased from $7 billion in 1960 to around $450 billion in 2007. Hence, it is very important to adopt a single and uniformly structured audit to oversight the activities. This single audit concept is mainly used to provide reasonable assurance to the federal government about the use and management of the grants. (GAO, 2007) Hence, the single audit is clearly a significant mechanism to examine the accountability of the governments on the use and management of its funds. However, many countries, such as United States, Indonesia, Thailand and Malaysia, are facing problems about the sufficiency and quality of the single audit. For example, the Presidents Council on Integrity and Efficiency (PCIE) of United States had identified serious single audit quality in its report with title Report on National Single Audit Sampling Project in 2007. More than half of the single audits performed had been identified with deficiencies and therefore such single audits were being classified as unreliable or unacceptable audits. In order to address the single audit issue, the PCIE with support from the Government Accountability Office (GAO) has made some recommendations to address this issue in the same report. These recommendations include: The single audit standards, criteria and guidance should be revised and improved. In order to conduct and perform single audits continuously, auditors are required to establish and maintain the minimum continuing professional education (CPE). The disciplinary processes should be reviewed and enhanced to deal with unacceptable audits and auditors that not meet the basic training and CPE requirements. 3.4 International Standard on Quality Control (ISQC 1) The International Auditing and Assurance Board (IAASB) of the International Federation of Accountants (IFAC) has approved and implemented the International Standard on Quality Control (ISQC 1) in 2004. Later in June 2006, the MIA has adopted the ISQC 1 as the approved auditing standard in Malaysia. All registered practitioners in Malaysia are required to comply with this new quality control standard and additional responsibilities have been imposed on them. Generally, the ISQC 1 is able to enhance the audit quality by focusing on the quality control within the firms. There are six quality control elements stated in the ISQC 1 that must be addressed in a comprehensive way. These six quality control elements are the leadership responsibilities for quality, ethical requirements, acceptance and continuance of client relationships and specific engagements, human resource, engagement performance and monitoring. As stated in ISQC 1, audit firms are required to document all evidences of the operation of all the six elements in their quality control systems and retain the documentation for an adequate period. The adoption and implementation of ISQC 1 could generally improve the quality of the audit practices by auditors besides increasing the quality control within audit firms. However, many small and medium audit firms in Malaysia had pessimistic perceptions on the adoption and implementation of ISQC 1. Similar result has been shown on the survey conducted in South Africa (Research Project, 2005). Most of them opined that such standards just burden their works and responsibilities because there are insufficient partners or staff to guide the quality control team due to the size of the audit firms. Furthermore, the ISQC 1 is said to be not user friendly because many partners and staff felt difficult to understand the standards and implement the standards in normal practice. This may due to the lack of exposures and training on the ISQC 1. (Aida Hazlin Ismail et al., 2008) 3.5 Corporate Governance Issue One of the initiatives that had been taken by many countries to promote high audit quality is enhancing the corporate governance of an organization. For example, in Malaysia, the Malaysian Institute of Corporate Governance (MICG) had introduced the Malaysian Code on Corporate Governance (MCCG) after the economic turmoil in 1997. When referring to corporate governance, people normally focus on the board of directors of organizations. The two main and observable characteristics of board of directors are the board composition and the separation of roles of Chairperson of the board and the Chief Executive Officer (CEO). The MCCG has provided guidance and recommendation on these matters. According to MCCG, an effective and well-balanced board of directors should have a certain proportion of independent directors. The MCCG has recommended the organizations in Malaysia should have a minimum of one-third independent directors on the board. This action can improve the oversight and control of board on entities operation and avoid too much power being placed on the CEO and top management. According to the governance theory, the independent directors should always protect the interests of shareholders by using higher audit quality services because auditing is a good monitoring activity to control the behaviour of management. (Zalailah Salleh et al., 2006) In addition, the MCCG also recommends the organizations of Malaysia to separate the role and function of the CEO and the Chairperson of the board. This recommendation is to avoid the unnecessary conflict of interest and the domination of power and authority by a single person in decision making. By separating the power and authority, the independent Chairperson of board is expected to have a higher demand on higher audit quality. (Zalailah Salleh et al., 2006) Furthermore, the MCCG also provides guidance and recommendation on audit and accountability. According to the MCCG, the board of directors has the responsibility to maintain an appropriate relationship with the external auditors of the organization by establishing transparent and formal arrangements. (Zalailah Salleh et al., 2006) As a conclusion, it is important to maintain the independent of the board of directors and separate the role of the CEO and the Chairperson in order to maintain the high audit quality of organizations. 4.0 RECOMMENDATION The audit quality issues have been debated around the world for a long time periods. Different research papers and studies have investigated and discussed the importance and shortfall of audit quality in recent years. In order to improve the audit quality, several recommendations has been proposed. Hence, in this section, we will discuss and elaborate some recommendations for improvement of audit quality. Understanding the nature of audit quality Audit quality should be recognized as a multi-dimensional construct. Researchers, educators, auditors and other relevant parties should always view audit quality in broader aspects, which should include both the service quality, such as responsiveness and empathy, and the technical quality, such as the reputation, capability and independence. Undeniably, there are empirical relationships occurred between the factors which explain the service quality and technical quality even though these two facets of audit quality have been viewed as distinct constructs. Hence, it is difficult to improve the audit quality by focusing on only single aspect and missing out the other relevant variables and aspects. Emphasizing on the perception of audit quality by clients and stakeholders In order to improve the audit quality of the services provided by audit firms and auditors, it is essential to understand clearly what audit quality is perceived by the clients and stakeholders, who are mainly the key users of the audit reports and audited financial statements. According to the survey conducted in the Auditqual: Dimension of Audit Quality by Angus Duff in 2004, both auditors, clients and stakeholders rated the reputation and capability dimensions of technical quality as the highest in their perception of audit quality. Hence, the reputation of firms and the capabilities of audit staff and partners seen to be the key factors when promoting the audit services to clients. This clearly show that clients and stakeholders are valuing much more on the firms reputation and auditors capabilities rather than other factors, such as the non-audit services provided. Proper systems to monitor and improve audit quality The audit firms provide services rather than products to their clients. Therefore, it is important for audit firms and auditors to provide the highest level of audit quality for their clients in order to gain sustainable competitive advantage and a leading position in the audit market. An adequate understanding of the clients perception on audit quality should be used as a basis to monitor and improve the audit quality. In addition, the audit firms should understand and minimize the audit quality expectation gaps which occur both within the audit firms and between the perception of clients, stakeholders and auditors. Hence, proper systems should be developed and put in place to continuously monitor the perception of audit quality by clients, identify the reasons for the shortfalls of audit quality and design appropriate actions to improve the audit quality. Employ, retain and develop competence staff As noted before, audit is a service provided by individual rather than a product. Hence, the audit quality is significantly dependent on the quality of the individual. Every audit firms should then employ, retain and develop high-caliber staff in order to provide high quality audit services that add values to the clients. The good quality staff should be equipped with adequate and necessary technical and interpersonal skills to deliver high level of technical quality and service quality to the clients and stakeholders in their audit works. Therefore, it is important for audit firms to properly screen individuals before employment being made through appropriate tests and assessments. After employment, continuous effective communication with staff should be established to retain and develop high quality staff. Examples of effective communication include open meetings, feedback via intranet and independen

Evaluation of the Financial Performance of a Chemical Company Essay

Evaluation of the Financial Performance of a Chemical Company The Lee Chew Cheng Wong Chemical Company produces high quality speciality chemicals, and it exports around 85% of its output to many countries and regions. Since the establishment in the mid 1980 this company has emphasized the shareholder value. To keep this focus, a new Chief Executive Lee Shan Loke Teo has proposed a lot of new policies. This assignment evaluates the financial rations with Sun See Chemical Company and average industry, and presents the financial effect of the proposal that Lee Shan Loke Teo adopts. That final section shows the recommendation of costing system and capital expenditure budget. Evaluate the financial performance As the profit and loss account shows, the Lee Chew Wong Chemical CompanyÂ’s net sales decreased from $5.6m to $4.2m, and the gross profit reduced from $1.8m to $1.5m, while in 20x9 the retained profit of the company reached the peak of $0.4m during this period. Although the sale volumes decreased, the profits went up. From the financial statement it can be found that the difference is due to the large operation expenses which eliminate the profit between 20x8 and 20x9, and the less retained profit also results the decrease of Earning per share. Therefore, the EPS and Retained Profit in 20x9 were higher than 20x8 and 20x7. As regards the balance sheet, in 20x9 the total asset of the company increased significantly compared to 20x8 and 20x7, because the fixed assets increased apparently but it also resulted the shortage of cash in 20x9. In the liability section, as follows as the increasing retained profit, in 20x9 shareholders equity (reserves) also climbed a lot. As far as we considered the financial ratios (Table1), from 20x7 to 20x9 the profitability ratios improved dramatically due to the less cost of sales and operating expense. The liquidity ratios become worse, because the growing fixed assets resulted in the lack of liquid asset. The following part is going to compare financial performance with its major rival, Sun See Chemical Industry. Table 1 ======= The Lee Chew Wong Chemical Performance Ratios 20x9 20x8 20x7 20x9 Industry averages Gross profit to sales (%) 35.71 33.33 32.14 44 Operating profit to sales (%) 21.43 13.33 14.46 30 Return on capital ... ...1998), Costing, an Introduction, 4th Edition Dyson, J.R. (1997), Accounting for Non-accounting Students, Pitman Publishing. Elliott, B. and Elliott, J. (2002) Financial Accounting, Reporting and Analysis, International Edition, Istvan D.F. (1970). Capital-Expenditure Decisions: how they are made in large corporations. Indiana University. Jones R.L., Trentin H.G. (1971). Budgeting: Key to planning and control. American Management Association, Inc. Lewis, R. and Pendrill, D. (1996), Advanced Financial Accounting, 6th edition Louderback, J.G., Maurice, L. and Hirsch, J.R. (1982), Cost Accounting, Accumulation, Analysis, and Use, Wadsworth International Student Edition Pike, R. and Neale, B. (year), Corporate Finance and Investment-Decision and Strategies, 4th edition, Financial Times/Prentice Hall. Pike R.H., Wolfe M.B. (1988). Capital Budgeting for the 1990’s. A Review of investment trends in larger companies. The Chartered Institute of Management Accountants. Wood’s, F. (1993), Business Accounting, Pitman Publishing. http://teachmefinance.com/costofcapital.html http://www.dod.mil/comptroller/icenter/learn/abconcept.pdf http://www.expectationsinvesting.com/tutorial8.shtml

Carbon Dioxide and Deforestation

Kayla Luther Module 4 Assignment 2 Course Project July 27, 2011 Outline : Deforestation Introduction: Deforestation is not something we can just look over. There are many things in our lives that we take pride in and protecting our forest is one of them. Our trees help our animals live, our crops grow, and our families survive. Thesis Statement: How do humans benefit from the trees? Arguments: I. Is deforestation the cause of climate change? A. The forest can provide many different products. 1. Consumers use these products everyday ? Cost of products increasing 2. Carbon Dioxide in the atmosphere ? Most trees hold in the carbon dioxide . Changes in the ecosystem ? loss of trees mean higher risk of disasters. II. Rain forest are slowly vanishing B. â€Å"Slash and Burn† process. 1. Many farmers are following this process. ? new farmers and crops 2. loss of animals and species ? lose their homes and food 3. the rate of deforestation ? within 100 years all forest will be vanished III. Ecosystem vs. Deforestation C. The forest ecosystem benefits all humans. 1. Most places don’t have fresh water sources so the forest provides many resources. ? clean water 2. We takes trees for granted but what really is their purpose. ? Trees collect CO2 and release oxygen IV. Is pollution worse than deforestation? D. Flying in an airplane is better than cutting down trees. 1. The amount of CO2 released into the atmosphere ? One day of deforestation equals 8 million people flying 2. The amount of CO2 a tree holds. ? released into the atmosphere V. Is livestock and crops really that important? E. How can the livestock and crops live without tress? 1. Farmers should find clear land instead of clearing land. ? Trees provide food, shade, water, and oxygen for the livestock and crops. 2. New businesses and communities ? loss of trees VI. Where would the world be without trees? F. Is the world going to end because the lack of oxygen? 1. Natural Disasters are causing trees to be torn down. ? Tornadoes, hurricanes, and drought 2. Recycling will help reduce the amount of trees that have to be cut down ? use less packaging, paper, and plastic Conclusion: If we start thinking about our futures then we shouldn't have any problems in reducing the way we live now. Our planet needs our help by saving it and protecting what we have left. We all need to start by recycling, planting trees, and save what wildlife we have left. Even if we only help by ding one thing it is still considered helping. References: FAO. (2006). Scientific facts on forest retrieved on July 13, 2011 from http://www. greenfacts. org/en/forests/index. htm#2 Facing the Future (2011). Deforestation retrieved on July 27, 2011 from www. facingthefuture. org/servicelearning/fastfactsquickactions/deforestation/tabid/182/default National Geographic. (2011). Deforestation retrieved on July 13, 2011 from http://environment. nationalgeographic. com/environment/global-warming/deforestation-overview. html University of Michigan (n/d). Deforestation retrieved on July 13, 2011 from http://www. globalchange. umich. du/globalchange2/current/lectures/deforest/deforest. html Howden, D (2007). Deforestation: the Hidden Cause of Global Warming retrieved on July 13, 2011 from http://www. independent. co. uk/environment/climate-change/deforestation-the-hidden-cause-of-global-warming-448734. html Emulgator. org (2005-2008). Pros and Cons of Deforestation retrieved on July 13, 2011 from http://www. emulgator. org/Politics-and- Government/5715-The-Pros-And-Cons-of-Deforestation Deforestation ( 2008). Pros and Cons of Deforestation retrieved on July 13, 2011 from http://edu. udym. com/pros-and-cons-of-deforestation/

Genuine Progress Indicator

Alexander Di Franco TA Victoria Fast Geography 108 18 November 2012 The Motor City: Industrial Hero to Zero The Genuine Progress Indicator (GPI) is a fantastic model to measure the overall well being of the economy in great detail. Opposed to the Gross Domestic Product (GDP), which only takes into account total dollar value, the GPI does just that, but also includes figures that represent the cost of the negative effects related to economic activity. It gives the important details of the economy and the state of the citizens within in it that the GDP simply cannot.Look at Detroit, Michigan; the â€Å"Motor City†, was at one time one of the most prosperous cities in the world, and a global industrial giant. Today, it’s a ghost town, not to mention a hellhole. The collapse of the automotive industry from the early 2000’s to the present has completely destroyed the former global giant in every way. The precipitous decline of the Detroit economy can be substantiated by using both the GPI and GDP method. Using academic and popular media references, these two approaches will be compared using the issue of the collapse of the automotive industry in the â€Å"Motor City†.The GPI approach represents this situation most accurately, and is most relevant because it not only takes the financial state of Detroit into consideration; it takes the environmental and well-being factor of the citizens into consideration as well. The GDP does not. Through the disappearing population, the rising rates of unemployment and poverty, and the exploding crime rate, it is clear that the costs of the overall well being of this city are much more important than just the economic costs.The city of Detroit, Michigan was once the most prosperous, ‘booming’ cities in the world, especially in the second half of the twentieth century. This was thanks to their automotive industry, ‘the Big 3’. ‘The Big 3’ included Ford, General Moto rs, and Chrysler, who all have their world headquarters located in Detroit and its vicinity. During this time period, ‘Big 3’ sales had soared from 6 million units in 1950, to 17 million in 2000. To break this time period down in depth, from 1950 to 1991, the sales of the units increased by double-digit percentages annually.In contrast to that, from 1992 to 2007, figures of annual sales rarely fluctuated by more than 3 percent per year (Klier, and Rubenstein 36). Consumers had an insatiable appetite for American vehicles manufactured by the ‘Big 3’; they were on top of the world so to speak. This surge in sales was not only bringing in great amounts of money into Detroit and its vicinity, it was bringing in great job opportunity, whether it was factory jobs or office jobs. This was truly the golden era for Detroit, and its populous prosperity was to be found everywhere.The statistics don’t lie, stating that Detroit’s population peaked at aroun d 2 million in the 1950’s (Linebaugh). During that time, it was the fifth largest city in the USA only behind New York, Chicago, Philadelphia, and Los Angeles, and was in the top 10 as recently as 1990 (Linebaugh). With all going so well, it was just a matter of time before things turned for the worse. As the saying goes, â€Å"all good things come to an end†, and this describe Detroit’s ugly, disastrous transformation in a nutshell. According to CNBC, Detroit is the 3rd worst city to live in the USA, and is the most dangerous (Crowe).What was the catalyst for this metamorphosis from prosperity to urban decay? It’s quite simple; their automotive giants were getting out performed by foreign competitors such as Toyota, Honda, and Hyundai. One of the factors that lead to this was that the ‘Big 3’ became complacent and arrogant due to the fact that they had little to no foreign competition prior to this decade. Thus they had an extremely large po rtion of the North American market share. Because of this arrogance and complacency, both quality and reliability began to suffer.The foreign automakers rated consistently higher in both quality and reliability. Another was the fact that the ‘Big 3’ depended critically on selling large volumes of light trucks (minivans, SUV’s, and pickups); these vehicles were their backbone (Klier, and Rubenstein 36). As gas prices began to rise, and eventually soared, consumers were looking for more affordable alternatives, with regards to fuel-efficiency. This was one characteristic all of the ‘Big 3’’s light trucks lacked. What was the alternative? Foreign-headquartered automakers (such as Toyota, Honda, Hyundai, etc. fuel-efficient vehicles. These vehicles would cut down the time and money consumers would spend at gas pumps, which was extremely attractive. The statistics of the ‘Big 3’’s production of light trucks from 2007 to 2009 do not lie. In 2007, 10. 4 million light trucks were produced. In 2009, this number decreased by a staggering 46% to 5. 4 million (Klier, and Rubenstein 36). The foreign automakers fuel-efficient vehicles took the market by storm in that period, and completely dominated the US automakers in the market share.This was the nail in the coffin for the city of Detroit. The one main thing that drove their economy through its history was becoming more and more irrelevant as the time passed. No one was buying American made vehicles. It got to the point where General Motors and Chrysler had to be bailed out by the government. To Detroit’s fairness, the economy is on its way back up today, and the automotive industry is starting to regain some ground, but the city of Detroit will never be the same, not even close to what it used to be.How has this historical collapse affected the â€Å"Motor City† today? It begins with the population. As previously mentioned, Detroit’s popula tion peaked at about 2 million people in the 1950’s. This is the highest their population was, and ever will be. Kate Linebaugh of The Wall Street Journal states that as of 2010, Detroit’s population had fallen back 100 years. The population as of that date was 713,777, the lowest it has been since 1910, 60 percent less than it’s peak in the 50’s, and 25 percent less than it had been in 2000 (Linebaugh), which is absolutely unbelievable.Also, Detroit is now the nineteenth largest city in the USA behind Indianapolis, and Columbus (as it used to be in the top 5, and top 10 as previously stated) (Linebaugh). The population is literally disappearing as time moves on. Along with this issue, is the skyrocketing poverty and unemployment rate. The current unemployment rate is 19. 6 percent, which is almost double the national rate, and the highest the city has even seen (Daily Mail Reporter). This number has been on a steady rise within the past decade, and as a result has put ore and more people on the streets, being homeless. 34. 5 percent of Detroit’s population is below the poverty line (US Census Bureau). Also, the rate of violent crimes is at 2,137 per 100,000 residents, which is the highest in the USA above St. Louis and Oakland. This statistic makes the â€Å"Motor City† America’s most dangerous city for the fourth year in a row (Fisher). The city is in complete ruin; it seems like absolutely everything is going downhill. With all going so wrong, especially in the last decade, how on earth could the GDP of Detroit increase at all?Take a look at the numbers from the recent decade. From 2001, there is a steady increase in the GDP until 2007, until a short but steady decrease until 2009, where it goes up again from there (BEA: US Department of Commerce). This is a completely inaccurate representation of the state of Detroit overall. With the collapse of the automotive industry, which lead to all the problems previo usly mentioned (population diminishing, poverty and unemployment rate rising, and crime rate sky rocketing) the GDP is not an appropriate measure or representation of the Detroit economy overall.This is due to the fact that the GDP just takes into account total dollar value, and not the well being of the citizens or any environmental factors. According to the GDP, Detroit has been brining in increasing amounts of money from one year to the next in some periods of this collapse, but the overall state and well being of the city and its population has been on a constant downward spiral. To truly understand and represent the real state of the Detroit, and what is really going on within the economy and the well being of its citizens, the GPI must be used.If the GPI were taken in contrast to the GDP of Detroit since 2001, it would steadily be going downhill and opposed to the fluctuating GDP, which was mostly increasing (with exception to 2007-2009). All the situations Detroit is encounte ring as a result of the auto industry collapse bring the GPI downward. For example, take the cities record high unemployment rate. In Clive Hamilton’s article about the GPI, he talks about the issue of unemployment and underemployment. He says that social costs of unemployment lead to declining levels of health, increased amounts of suicide, and increasing levels of crime. Also there are the psychological osts of unemployment, which include trauma, stress, and family breakdowns (Hamilton, 20). Therefore, unemployment is a major negative factor on the GPI. Also, Hamilton talks about defensive expenditures, saying that GDP counts them as additions to output, however GPI deducts them, because they are undertaken to offset some decline in social welfare (Hamilton, 16). For example, this means that the record-high crime levels in Detroit create additions to the GDP because there would be a need for more police, more medical staff, and things would need to be repaired. On the other hand, the crime would deduct the GPI.This is because the cost of more police, medical staff, and repairs are undertaken to offset the decline in social welfare that crime causes. Lastly, the diminishing population of Detroit is a ‘no brainer’ as a deductive quality of the GPI. Clearly people want to leave, or avoid living in the city of Detroit in this era. The social welfare of the citizens is at an extreme low. It is clear that the GDP cannot represent the economic state of an area in nearly as much detail as the GPI can. This is why in my opinion the GDP is not relevant in terms of an indicator of an economy’s overall well-being.I strongly believe that the GPI gives a more accurate representation of the overall state of the economy thus should be used as the primary economic measure rather than the GDP. Detroit’s GDP was on the rise for most of this decade, even through the historical collapse of its worldwide automotive industry. However, it is clear that the welfare of its citizens and the state of the city are and will continue to be at a devastating low. This is made clear through Detroit’s disappearing population, the rise of unemployment and poverty rates, and the skyrocketing crime rate.With all of these factors considered in the GPI, as well as dollar value, the GPI ultimately triumphs over GDP and gives people a true assessment of an economy overall, that the GDP simply fails to do. Works Cited Klier, Thomas H. , and James Rubenstein. â€Å"Economic Perspectives. † Economic Perspectives. Q II (2012): 35-54. Web. 11 Nov. 2012. Linebaugh, Kate. â€Å"Detroit's Population Crashes. † Wall Street Journal 23 3 2011, n. pag. Web. 13 Nov. 2012.