Contemporary issues in accounting and finance Case Study

Contemporary issues in accounting and finance - Case Study Example In brief, economists (Norton & Porter, pp. 56-63, 2009) have blamed organizations for considering short-term profits of the company to pay huge rewards and compensation to CEOs and directors that is a significant form of excessive amount of risk-taking by the organizations, causing long-term financial issues. Despite of different claims and blames, analysis of the studies (Saudagaran, pp. 21-25, 2009) has indicated that everything goes down to one end that is accounting and its principles. A huge number of studies (Sorkin, 2008) have indicated that there has been deficiency of ethical and professional accountants in the profession that were involved in manipulating accounting rules and metrics on short-term basis that resulted in a financial issue for the organizations, as well as the banki... Economists believe that this specific rule inclined accountants to exaggerate the financial matters in front of the national banks that contributed adversely in the promotion of economic recession. In addition, a number of experts (Manning & Nothwehr, pp. 1, 2008) from the banking sector consider the rule as a very dangerous principle that resulted in the representation of losses of billions of dollars, whereas, the organizations never lost it. In an article of the New York Times, author wrote, "FAS 157 represents the so-called fair value rule put into effect by the Federal Accounting Standards Board, the bookkeeping rule makers. It requires that certain assets held by financial companies, including tricky investments linked to mortgages and other kinds of debt, be marked to market. In other words, you have to value the assets at the price you could get for them if you sold them right now on the open market" (Sorkin, 2008). Besides FAS 157, a few experts have indicated similar objective of mark-to-market rule, FAS 115 that regulates the organizations to perform the following tasks. Although it is a good principle, but it allows companies to manipulate things in a tricky manner, and this possibility of manipulation indicates the intensifying capability of this accounting principle to encourage frauds and subsequently, recessionary period around the world. Experts (Sorkin, 2008) have indicated that big names like CitiGroup, Lehman Brothers, etc used this accounting principle to show their exposure at fifty percent, whereas, it was only near to fifteen percent. In this regard, besides unethical practices involving personal

Challenges Minorities Face Trying To Get Ahead in Corporate America Essay

Challenges Minorities Face Trying To Get Ahead in Corporate America - Essay Example As an initial matter, the barriers to minority success in the corporate world are well-known. A Glass-Ceiling Commission was formed by Congress in 1991 to study the barriers and to make recommendations. Robert Reich, the former Secretary of Labor, described this glass ceiling as "the existence of invisible, artificial barriers blocking women and minorities from advancing up the corporate ladder to management and executive level positions" (Good for Business, 1991, p.iii). The problem, therefore, is not whether such problems exist, for they most certainly exist, but how to remove the barriers to corporate advancement. The first barrier is defined as a societal barrier, and this type of barrier is considered to be outside the power of the corporation. This barrier refers to educational restraints and to stereotyping and bias, whether conscious unconscious, which affect minorities. Minorities need the educational qualifications to even begin to think about working for a corporation in a significant capacity. This, in turn, demands access to good schools, access to the money necessary to focus on studying rather than working part-time jobs, and a commitment by corporations, communities, and governmental organizations to provide minorities with the financial resources and proper education. This is a dangerous barrier. The lack of access to a good education can lead to failure in the very beginning of a person's life. The second barrier is referred to as an internal structural barrier. This barrier, in contrast to the societal barrier, is firmly within the control of corporations. This refers to a lack of commitment to minority hiring, training, and inclusion in the "pipeline" system of advancement. This barrier assumes that a minority has the educational qualifications for a particular job. Nonetheless, statistics demonstrate that minorities with the same educational qualifications are not treated equally. The Glass Ceiling Commission highlights this barrier, An analysis of 1990 U.S. Census data shows that Black men who hold professional degrees and top management positions earned 79 percent of what white men earn. Black women, also with professional degrees and in top management positions, earn 60 percent of what white men in comparable positions earn (Good for Business, 1991, p. 13). These statistics suggest that corporations are not doing enough to promote capable and well-qualified minorities within their own organizational structures. There is, in short, no disparity in educational qualifications. Indeed, the sole disparity seems to be in terms of compensation and access to promotion. The latter disparity, in a nation which prides itself on equality, is impossible to justify. The third barrier is a more generalized governmental barrier. This barrier ranges from the lack of data collection about minorities in private business to weak enforcement of government mandates and poor reporting of problems for minorities in the labor force. It must be admitted, in fairness to corporations, that their primary function is maximizing profits for shareholders. To impose costly and time-consuming governmental duties on corporations would result in dislocations of labor and inefficiencies. That said, it is the duty of the government, whether national, state, or local, to promote and protect the welfare of its