Nevertheless such mandatory disclosures presume that people can and will cognitively appraise such disclosures as against to higher noise trading. In the light of realities of emotional regulating, the SEC in general and its compulsory disclosure regime is particular might perform more harm than good and yet stay because of the emotional appeal rationales and considerations. (Parisi; Smith, 2005)
The history of U.S. federal securities regulation from the very beginning following the Great Depression to the most recent Sarbanes-Oxley Act of 2002 in the wake of Enron, Arthur Anderson, iet Aid, Worldcom, Tyco, Merk and Global Crossing is that of neglect of Securities Market interrupted by legislation in response to political and public pressure arising from highly primitive and public episodes of banking, corporate or securities fraud and scandals. Mandatory disclosures might be at best an impotent and at worst a socially harmful regulatory policy if the majority of investors…… [Read More]
The Securities and Exchange Commission (SEC) has a large responsibility for ensuring that the country's vital economic needs are protected. The purpose of this essay is to discuss a real world and practical application of the SEC's involvement in a case where accounting malfeasance was suspected and ultimately proven true in a court of law. This essay will examine the case of International Commercial Television Inc. (ICTV) and its accounting blunder that cost the accounting firm of Dohan & Company its repuatation and penalties.
According to the official SEC complaint, violation of Section 21(d) of the Securities exchange act was committed by ICTV's submission of their accounting statements. "These proceedings arise out of espondents' improper professional conduct during their audit of International Commercial Television, Inc.'s ("ICTV") 2007 financial statements. During fiscal year 2007, ICTV improperly recognized revenue and incorrectly recorded product returns, resulting in a material overstatement of…… [Read More]
hat issues does the secondary market face when it comes to IPOs?
The Economic Times (TET) in India explains that when a company issues securities to the public for the initial time, it is offered in the primary market. However, once the IPO (initial public offering) has been offered, and the stock can be listed in the market, those securities are then traded in the secondary market (TET). The main difference between the two markets is that when an investor puts down money for securities in the primary market, that investor deals directly with the company offering the IPO. But once the securities are in the secondary market, the investor buys them from "other investors willing to sell…" (TET).
hat can go wrong -- how can fraud occur in secondary markets?
In Forbes, contributor J.J. Colao offers an example of what can go wrong or awry with secondary…… [Read More]
The U.S. Supreme Court then granted a writ of certiorari to determine the meaning of the language "in connection with the purchase or sale of any security" (Reed, O. Shedd, P. Morehead, J. & Pagnattaro, M. 2008).
What argument did the security dealer make in seeking to have the civil complaint dismissed?
andford's defense in this matter was particularly interesting as he does not deny his involvement in the "simple theft of cash or securities in an investment account" (Reed, O. Shedd, P. Morehead, J. & Pagnattaro, M. 2008). For andford the issue is not that he sold the securities which he contends "were perfectly lawful," rather that the fraudulent activity of "misappropriation of the proceeds is desultory from the actual sale of the securities. If andford's argument is believable then the sales of securities would have been aligned with the investment strategy designed to secure principal and generate income.…… [Read More]
This could have been interpreted as the company having an orientation more towards money-making than to the development of strong ethics.
Leadership, or lack thereof, made a strong contribution to the Tyco failure. The company's leaders set the cultural tone of the firm, but they were also among the primary actors engaged in the fraud. Kozlowski and the other executives were front and center in the fraud, and committed many of the egregious acts themselves. There is little doubt that the Tyco failure had more to do with the caliber of the company's leadership that with any issues surrounding the employees themselves. For the most part, the structure and the leadership were the reasons for the Tyco failure.
Management was less complicit. Although the managers were influenced by the culture passed down by Tyco's leaders, they were less directly involved in the fraud. Perhaps for this reason, the firm was…… [Read More]
"Yet earnings estimates have acquired a life of their own and often generate more attention from the media and analysts than a company's actual financial results." (Whalen, 2003).
More conservative critics of analyst conflicts rules believe that they are a step in the right direction, but view them as a work in progress. For example, the Sarbanes-Oxley bill, which mandated many improvements in corporate managers' financial practices, did nothing to reduce the unethical practice by many managers of communicating only with those analysts who cooperate with management's forecasts of the future (oni and Womack). This and other rules need strengthening.
Wall Street Journal reported in April 2003 that the brokerage firms of the top investment banks are still more likely to give optimistic research recommendations to their own banking clients, calling to question if new disclosure rules reapply protect investor clients (oni and Womack). With all the hoopla to protect…… [Read More]
Though not empowered with the same legislative authority that the SEC can claim, FINA sets standards for stockbrokers and other financial industry professionals, and licenses individuals as well as oversees certain aspects of operations with regulatory eye (Little 2010; FINA 2010). Illegal trading or suspicious trading can lead to investigations by FINA that can then lead directly to legal problems for companies found to be in violation of laws and ethics guidelines, meaning that the securities issued by Holiday Inn could eventually face direct regulation by this body, and that the trading of Holiday Inn securities -- like other securities traded in the United States -- is always at least indirectly influenced by the standards and regulations established by FINA (Little 2010; FINA 2010).
Holiday Inn does not issue securities that are markedly different from any other company, and thus the stock this company issues are subject to no more…… [Read More]
(Dow Jones and Company, 2009). The DJIA can be used in three principal ways: as a yardstick, as a barometer, or as an investment.
When the DJIA is used as a yardstick, the goal is to measure performance from one period of time to another:
The most common use of an index by investors is to evaluate the performance of their own portfolios on a monthly or quarterly basis. This is the "benchmark" function of an index, and it constitutes the bogey that many investors try to beat with individual stock picks or with mutual funds. There is no official benchmark for the stock market. Each investor chooses his or her own. The only logical requirement is that the benchmark chosen should represent the part of the stock market that is targeted by the investor's portfolio. For example, if the investor dabbles in large stocks from a variety of industries,…… [Read More]
The management of large organizations is a very crucial issue, whether they are government-related or not (Argyris, 1993; Argyris & Schon, 1978; Broom, Jackson, Harris, & Vogelsang-Coombs, n.d.; Brown & Brudney, 2003; Hatry, 1999; Haynes, 1999). Often, however, the government does not seem to realize that it must manage itself in the same way that a business would in certain aspects if it is to succeed and therefore it does not market itself to the public.
The spending that has been involved with the Department of Homeland Security is also crucial, because it has changed over time to reflect the needs and the realization of what it takes to make the Department work (Eggen & Mintz, 2003). This spending is important to discuss, because it indicates how much of the government's money - and by extension how much of the tax dollars of Americans - is going toward funding this…… [Read More]
In these exceptions, which may be a one-time transfer of funds from a 401k to an IA or to a mutual fund, the financial services firms need to create ethical safeguards to ensure the confidentiality and actual funds themselves are secure. The bottom line is that the financial services firms need to create a highly secure, customized and tightly integrated series of web-based online trading applications and tools to make sure individual investors can work to attain their investment goals.
Improvements for Online Trading as a Self-Service Strategy
There are many opportunities for improvement for Web-based online trading tools, starting with even stronger security specifically on the area of inter-fund transfers and the recording of transactions. Today many of these Web-based online applications store history only for 12 months, and do not provide an audit record back three or five years of all in-account transactions. This lack of multi-year audit…… [Read More]
How has the Securities and Exchange Commission (SEC) improved reporting measures for publicly held companies? What are the weaknesses in SEC procedures?
The SEC has amended its reporting requirements in order to eliminate, modify, or integrate certain disclosure rules. These changes are aimed at improving disclosure effectiveness. Simplifying compliance without the need for significantly altering the total mix of information that is provided to the investors. Improving this reporting measures will allow public companies to eliminate redundant and duplicative requirements that forced the companies to publish or report the same information in different manners. Eliminating duplicate reporting requirements will make it easy for public companies to provide information to investors and investors will find it easy to retrieve information. The SEC also aimed at eliminating outdated requirements that are not consistent with recent legislation.
While the reporting measures are aimed at improving reporting for public companies, it is feared that…… [Read More]
This researcher rejects the existence of online communities because computer mediated group discussions cannot possibly meet this definition. Weinreich's view is that anyone with even a basic knowledge of sociology understands that information exchange in no way constitutes a community.
For a cyber-place with an associated computer mediated group to be labeled as a virtual settlement it is necessary for it to meet a minimum set of conditions. These are: (1) a minimum level of interactivity; (2) a variety of communicators; (3) a minimum level of sustained membership; and (4) a virtual common-public-space where a significant portion of interactive computer mediated groups occur (Weinreich, 1997). The notion of interactivity will be shown to be central to virtual settlements. Further, it will be shown that virtual settlements can be defined as a cyber-place that is symbolically delineated by topic of interest and within which a significant proportion of interrelated interactive computer…… [Read More]
" (Harman, Flite, and ond, 2012) the key to the preservation of confidentiality is "making sure that only authorized individuals have access to that information. The process of controlling access -- limiting who can see what -- begins with authorizing users." (Harman, Flite, and ond, 2012) Employers are held accountable under the HIPAA Privacy and Security Rules for their employee's actions. The federal agency that holds responsibility for the development of information security guidelines is the National Institute of Standards and Technology (NIST). NIST further defines information security as "the preservation of data confidentiality, integrity, availability" stated to be commonly referred to as "the CIA triad." (Harman, Flite, and ond, 2012)
III. Risk Reduction Strategies
Strategies for addressing barriers and overcoming these barriers are inclusive of keeping clear communication at all organizational levels throughout the process and acknowledging the impact of the organization's culture as well as capitalizing on all…… [Read More]
Securities and Exchange Commission (SEC) are one of the most well-known entities that regulate markets, protect investors and facilitate the capital market structure. The SEC was founded in 1934 in the wake of the Great Depression -- The SEC was created by section 4 of the Securities Exchange Act of 1934. The SEC was established by the United
States Congress as an independent, quasi-judicial regulatory agency during the Great
Depression that followed the Crash of 1929. Now, more than ever, first time investors turn to the market to protect their future income, send their children to college, pay for homes. The primary duty of the SEC is to promote sound market regulation, sustain economic growth and encourage capital formation.
The Capital Market strategy is one of many used by this entity. It is a market for securities (debt or equity), where business enterprises and governments can raise their long-term funds.…… [Read More]
Strict Liability & Securities Law
Congress defined security laws to include investment contracts, but "investment contract" is not itself defined in law (Condomimiums as Investment Contracts under the Security Laws, 2011). An Eleventh Circuit court decision indicated "The test for an investment contract is whether the contract is (1) an investment of money (2) in a common enterprise (3) made with expectation of profits to be derived solely from efforts of others" (Condomimiums as Investment Contracts under the Security Laws, 2011). ecause law is lacking in adequate definitions, it is completely possible for a business owner to operate a business without fully understanding the laws that govern the individual practices.
The Trust Indenture Act of 1939 applies to debt securities such as bonds, debentures, and notes offered for public sale (The Laws That Govern the Securities Industry). The Securities Acts of 1933 and 1934 govern the disclosure of financial information…… [Read More]
Securities and Exchange Commission (SEC)
Accounting Irregularities and Missing Internal Controls in the LIBOR Currency Manipulation Scandal
The London Interbank Offered Rate, or Libor for short, was the recent subject of collusion between some the world's largest banks to manipulate the exchange rates; no one seems to know for sure when these banks began to manipulate the exchange rate, but some reports show these activities beginning in 2003, or possibly much earlier (McBride, Alessi, & Sergie, 2015). The Libor rate represents a benchmark interest rate in which banks lend to each other in London interbank market. The exchange rate is calculated daily and determined by a submission of eleven and eighteen banks who submit their average borrowing rates for the day.
The Libor rate was considered to be a fairly reliable benchmark for determining an amount of interest that was used in determining short-term transactions and this rate had indirect…… [Read More]
Institutional investors are finding XBRL to be valuable from the standpoint of creating taxonomies that give them greater insights into the performance of the firms they hold significant stock share positions in. In addition, investment analysts with leading Wall Street firms are using XBRL as a means to define entirely new and more detailed analysis of financial statements and key ratios as well. Given the fact that XBRL treats financial information as a referenced by an XML-compatible tag, each financial ratio, item on a financial statement and significant event as defined by the Sarbanes-Oxley (SOX) Act are all tagged. This significantly improves reporting timeliness and has led to the SEC stating that the future of financial reporting will be in real-time (Tribunella, Tribunella, 71).
The Connection between XBRL and Real-Time Reporting
With XBRL, the ability of corporations to report in real-time becomes possible. No longer are corporations limited in the…… [Read More]
Despite its clear benefits and advantages in terms of ease of use and cost effectiveness, there are certain risks associated with wireless networking. These risks are discussed further below.
Review of the Literature.
Security Risks Associated with IEEE WLAN 802.11. The applications for wireless communication technology continue to develop and expand; today, at least, the 802.11b is the standard of choice for wireless router communication used with network installation (Gonazles & Higby 2003). "The integrity of the transmitted data is a valid 2.4 GHz. At this wavelength medium, the propagation of wavelength maintains strong connectivity" (Gonzales & Higby 2003, p. 30). The technology of WLANs actually dates back to the mid-1980s; during this period, the Federal Communications Commission (FCC) freed up radio frequency (rf) to the industry. "Initially, this was viewed as a broadcast reception procedure and very little thought went to broadcast transmission" (Gonzales & Higby 2003, p. 30).…… [Read More]
Health-Care Data at Euclid Hospital Security and Control: A White Paper
Protecting Health-Care Data
The efficiency of the modern healthcare system is increasingly becoming reliant on a computerized infrastructure. Open distributed information systems have been initiated to bring professionals together on a common platform throughout the world. It needs to be understood that easy and flexible methods of processing and communication of images; sound and texts will help in visualizing and thereby cure illnesses and diseases effectively. Another aspect is that the easy access and usage can risk patient privacy, accountability, and secrecy associated with the healthcare profession. Therefore, Information Technology -- IT must be able to focus mainly on improving the health of the patient and should not put the patient's health in danger. (IO Press)
This implies that right data has to be made available to the right person at the right time. IT strongly affects the confidentiality…… [Read More]
ite Aid Fraud
Over the years, there have been numerous cases of financial fraud perpetuated within the organizational mainstream of major companies. Financial fraud is often a well-coordinated sort of white-collar crime that often -- but not always - requires complicity and collusion amongst financial accountants, top management and auditors. ite Aid came to the limelight after the U.S. Securities and Exchange Commission announced that it would be filing accounting fraud charges against the company in 2002
Meanwhile, the United States Attorney for the Middle District of Pennsylvania leveled similar criminal charges accusing former CFO Frank Bergonzi, former CEO Martin Grass and former Vice Chairman Franklin Brown of perpetuating an immense accounting fraud scheme
. Compounding the crisis, according to former ite Aid COO, Timothy Noonan, were years of legal coaching amongst staff and mid-level employees. As investigations ensued, evidence of fraudulent manipulation of accounts, corporate malfeasance, and financial overstatement…… [Read More]
Organizations Establish ules for the Creation or Use of Accounting Information:
- Securities and Exchange Commission
- New York Stock Exchange
Internal evenue Service
Describe what kind of rules each makes, why they make them, and how they enforce them. Which organizations make laws, and which publish guidelines? What is the difference? What are the different consequences for those who bend various sets of rules? (Causey Enron case) How might Causey's defense be stronger or weaker under IFS guidelines rather than GAAP?
The rules that govern the three organizations may not be specifically made by that organization, but they are enforced by it. The Securities and Exchange Commission (SEC) is not a law or even rule making body, but the members do suggest legislation and, as one of its main functions, enforces the laws that have been passed by congress (SEC, 2012). The New York Stock Exchange (NYSE) is a…… [Read More]
The first three organizations in line to recuperate their funds were Citigroup, J.P. Morgan and General Electric Group. They had been offering financial solutions and encouragement to purchase the WorldCom stock based on a favorable business relationship. However, at the time when bankruptcy procedures were commenced, the three organizations recognized their losses and intended to recuperate them.
A succinct presentation of the period surrounding the crisis could be reveled by the media stories:
27 June 2002 - information on the people affected by the WorldCom crisis become available - about 60 banks across the globe had granted loans to the organization or purchase bonds
27 June 2002 - SEC charges the organization with fraud and three organizational leaders are subpoenaed before a governmental committee
28 June 2002 - John Sidgmore announced a cut in costs by $1 billion and the downsize on 17,000 employees
U.S. President George Bush condemns organizational…… [Read More]
Fargo & Co. In detail. It puts light on the financial performance of the organization. The core products and competitive advantage of the organization have also been analyzed by the preceding paper. In addition to that this paper also highlights the SWOT analysis and the Porter's five forces model of Wells Fargo & Co.
Wells Fargo & Co.
Wells Fargo & Co. is a stable and renowned name in the banking industry. This organization has a commendable history of growth and success. Its mission and vision has enabled it to navigate successfully through the complicated and critical times of recession and economic downturn. It has been in the business since last many years and has gained a stable and prominent share in the financial and banking industry of the United States of America. (Amundson, 2011)
Wells Fargo & Co. started operating officially in the year 1852. They opened…… [Read More]
Wealth, Power and Insider Trading on Wall Street
In today's increasingly internationalized worldwide economic system, defined by the expansion of multinational corporate conglomerates into foreign shores, the necessity for effective and efficient financial regulation to prevent criminal conduct covered by the catchall term "insider trading" has never been greater. Whereas autonomous countries once maintained clear authority over businesses which were built on their shores, through levying taxes, enforcing fiscal regulations, and instituting a lawful system of commerce, today the most successful companies are those with the wherewithal to transfer their operations abroad. Global financial management requires a comprehensive comprehension of foreign exchange and currency markets, derivatives securities, international financial debt and equity markets, international portfolio investments and the global market for real assets. Due to the fact that "financial markets and intermediaries today are globally linked through a vast international telecommunications network," with this continual process resulting in "the trading…… [Read More]
Safeway will drastically expand its market by taking over Sobeys. It will grow to expand the entire Canadian geography as well as almost double the number of stores it owns. In addition to this Safeway will have one less competitor in the marketplace, and be larger which will make it easier to stand against the other competition in the marketplace. The decision for a company to acquire another company is a massive and critical decision. The company acquiring must be ready to undertake the challenges involved, as well as the target company needs to be a proper fit with the other company. All of these changes mean many years of possible turbulence for the company and its employees, but if done carefully and mindfully the company will come out of the situation with a large financial and market gain.
This assignment had great value and the learner was able to…… [Read More]
Several terms and definitions are valuable to understand financial statements. In the United States, financial statements of public corporations are produced in accordance with the U.S. Generally Accepted Accounting Principles. These principles govern how the information for financial statements is compiled and presented. The purpose of these principles is so that all stakeholders can easily understand the statements and make comparisons across both time and across different companies, because the statements are produced and presented in a consistent manner. The International Financial eporting Standards (IFS) are the international equivalent of GAAP. While several countries utilize a national version of GAAP (U.S., Canada, UK, etc.), more than 100 countries use IFS, making this set of standards the most widely-adopted in the world. There is a move to converge national GAAP standards with IFS, including a multi-year project to converge U.S. GAAP with IFS. For now, however, IFS represents a different…… [Read More]
Amazon is the largest internet-based company in America with headquarters located in Washington and Seattle in the United States. The company was founded in 1995 by Jeffrey Bezos and it started as online bookstores then diversified to selling videos, CDs, MP3 and DVDs. Today, Amazon offers about 4.7 million books, computer games, DVD and a wide variety of items of all kids. Ever since Bezos opened the doors of Amazon, online retailing has been defined and redefined for the rest of the Internet retail worldwide, and today it offers the customers a superior shopping experience through the provision of a high level of customer service. This research paper will discuss the impact of the Amazon's mission, vision and primary stakeholders' overall success, while analyzing different forces of competition and how they impact the business of the company. SWOT analysis will also be performed to determine the strengths, weaknesses, opportunities and…… [Read More]
Earnings were strong for employees as well as shareholders. Many employees owned stock or were dependent upon a rising balance sheet to ensure that they received their bonus and salary. Additionally, as at HealthSouth, there can be kind of a 'groupthink' effect, where people assume that something is 'okay' because everyone else, including powerful upper-level managers, are 'doing it.'
There are a number of laws that protect whistleblowers. The Dodd-Frank Wall Street eform and Consumer Protection Act was established to encourage individuals to report financial fraud to the SEC (Securities and Exchange Commission). ecognizing the profound financial sacrifice many whistleblowers make, Section 922 of the Dodd-Frank Act mandates that the SEC reward individuals who provide original information that results in sanctions in excess of $1 million in civil or criminal proceedings against the offending company (Oswald & Zuckerman 2010).
In a HealthSouth-like situation, being a whistleblower is not simply a…… [Read More]
Sarbanes-Oxley has been successful in enabling higher levels of accountability throughout publicly-held companies mainly as a result of re-defining core processes as they relate to financial reporting and disclosure of events, both positive and negative that impacts a company's financial performance.
Sarbanes-Oxley for SOX as it is sometimes referred to is considered by many to be the "snapping back into place" of ethics in business after the Enron, MCI, Tyco and many other corporate scandals that rocked the markets of the world in 2001 and forward. In today's environment the SEC would most assuredly be focused on and demand greater visibility into how these write-downs either lead to written down and obsolete products, or the selling off of older-generation products on cents on the dollar. Given the intense focus on corporate accountability and standards, and the widespread fraud that has been found in both public and private corporations, the exact…… [Read More]
Mission and Vision tatement Analysis
Linking Wal-Mart's Mission and Vision to Their trategic Goals and Objectives
Assessing the Link Between Wal-Mart's Financial Performance And Its trategic Goals
Wal-Mart Competitive and Marketing Analysis
Wal-Mart Marketing Analysis
Potential Wal-Mart Merger & Acquisition trategy
Incentive and Reward trategies for Wal-Mart Employees
Evaluating How Current trategies Define Ethicacy Levels at Wal-Mart
Wal-Mart Ratio Analysis
Income tatement Analysis, 2007 -- 2012
Analysis of WalMart Corporation
Mission and Vision tatement Analysis
All internal systems, processes, external stakeholder management initiatives, supply chain management, sourcing, quality management and merchandising initiatives in WalMart revolve around the fulfillment of the expectations they create with their customers daily. Their Low Price Everyday (LPED) value proposition permeates their entire value chain, galvanizing it around the mission of delivering exceptional value on a consistent basis to customers. The mission and vision of WalMart rely on LPED as the catalyst and unifying…… [Read More]
crime doesn't pay sometimes is a whole point which can't be applicable, especially when you're trusted with the management of multi-billion dollar corporation, and to be in charge of the well -- being of thousand of people. It's so difficult to criminalize someone's action, if such action doesn't cause any harm to anyone or if someone doing a lot of critical charity works. The case of Richard M. crushy can be described as one of the most important scenario which can acts as one of the success stories, showing how far most of these business ethnical values can be abused to hurt everyone for a period of time. As stated by Jennings (2012) in his book "Business Ethnics Class" unethical practices can only last for a short time, and nothing helpful can be found out of it.
However, the carpenter teachings regarding people who do not pursue wisdom that are…… [Read More]
" (Schlossberg, 2004)
FERC analyzed while making a review of the electric utility mergers proposition, the transaction being proposed "likely effect" on (1) competition;
(2) rates; and (3) regulation. (Schlossberg, 2004)
There are stated to be "no antitrust exemptions for transactions subject to FERC review and such mergers are regularly reviewed by either the Federal Trade Commission (FTC) or the Division." (Schlossberg, 2004) The Securities and Exchange Commission had previously held jurisdiction for reviewing acquisitions of stock of electric utility companies however, the authority provided under the Public Utilities Holding Company Act of 1935 was repealed in 2005.
III. FORESEEAILITY DOCTRINE REHAILITATION
The work of Trujillo (2006) entitled: "State Action Antitrust Exemption Collides with Deregulation: Rehabilitating the Foreeseability Doctrine" states that a capitalist society that has policies which were established for the purpose of regulating "the promotion of competition in traditionally regulated industries such as the electrical market seems counterintuitive.…… [Read More]
Asset Allocation and Industry Sectors:
There are several economic concepts that affect an individual's daily finances and investments such as asset allocation and industry sectors. Asset allocation is primarily described as the manner with which an individual divides his assets among various asset categories like cash, bonds, stocks, and real estate. This fundamental principle also refers to an investment strategy with which an investor can lessen risks through diversification. One of the major goals of asset allocation is that it seeks to balance risk and reward through distributing a portfolio's assets based on a person's goals, investment horizon, and risk tolerance. Notably, the process of determining which combination of assets to retain in a portfolio is usually a very personal one ("Beginner's Guide to Asset Allocation," 2009).
The other common financial term or concept is industry sector where the two words have been used interchangeably to refer to a group…… [Read More]
How firm raise capital by using venture capital? What conditions we need to raise capital by using venture capital?
Many startup companies are not mature enough to obtain capital from the public or secure a loan with the local banks in their area. They therefore, have to rely on venture capital as a way of raising capital for the firm to continue with the daily operations. Firms hence, raise capital by going out and looking for people who are willing to invest their money in a company that they see has the potential for growth. The company looks for a number of people who can pitch in large amounts of money depending on the nature and type of the business which if successful is expected to give above average returns to investors (Krishnan & Ivanov et al. 2011).
There exist certain conditions for a firm to secure capital…… [Read More]
Vose, D. (2008). Risk Analysis: A quantitative guide. (3rd ed.). West Sussex, England: John Wiley & Sons, Ltd.
he book is written on risk analysis using quantitative methodologies. he book has two parts and chapters are divided into these two parts. he first part is intended to help managers realize the rationale for conducting risk analysiswhereas the second part explains the modeling techniques of risk analysis. First part describes in detail the rationale for risk analysis, how to assess quality of risk analysis, and how to understand and use risks analysis results. Part two is based on use of statistical and mathematical processes to build risk analysis models. Correlation, dependencies, optimization in risk analysis, and checking as well as validating risk analysis model are the main important themes discussed in part two. he book adequately describes the risk analysis models and how best to use them, both in perspective of…… [Read More]
reporting of capital and operating leases and their impact on fair value measurements. The essay surveys lease accounting standards from 1976 thru the present.
The basic principle of lease accounting is that some leases are merely rentals, while others are in effect purchases. U.S. regulations that specify lease accounting rules are issued by the Financial Accounting Standards Board (FASB). The primary FASB statement on leases was Number 13, issued in 1976, and is also known as FAS 13, SFAS 13 and FASB 13. Over the years it has been amended several times by additional FAS, including FAS 22, FAS 23, FAS 27, FAS 28, FAS 29, FAS 98, and FAS 121. In addition to financial accounting standards, various interpretations and technical bulletins have also been issued to provide additional guidance. Lease accounting rules were previously labeled as section L10 in the FASB Current Text, while the new FASB Codification uses…… [Read More]
This is significant because it shows how some critics of contrarian investing will often point to the various instances of speculation and assume that it is contrarian investing. In some cases the psychology of consumers can become so extreme, that the definition of what is speculative expands greatly. As a result, using contrarian investing in conjunction with other indicators / tools can help prudent investors and traders, be able to identify when the market condition are becoming more extreme.
Contrarian Indicators and Tools
When using the different contrarian indicators / tools in conjunction with one another, you can begin to see how this strategy can be used, to effectively determine if the market conditions are overbought or oversold. There are number of different tools that can be utilized to indentify major changes that are occurring in the trend of a stock or the market averages. These would include: headlines…… [Read More]
There are no other material costs related to the Offer is expected.
15. Who is the investigating accountant for this prospectus and what is their role?
Tiaro Coal Limited's investigating accountant is DO Kandalls Corporate Finance (NSE) Pty Ltd. The purpose of the investigating accountant's appointment is to report on the concerns raised in Australian Securities Investment Commission's (ASIC) application in relation to the Offer. The report must comply with the Australian Auditing Standard (AUS) 804 or at least, the reasonableness of the report can be appropriately verified (Cockburn: 2002: 1).
16. What are the risk factors associated with this prospectus and briefly describe each?
Investing in Tiaro Coal Limited involve embracing the susceptibility to uncertainties and risks. According to Section 10 of the Prospectus, Tiaro Coal's business activities are subject to both business risks and general risks. In relation to the nature of the business, there is the associated…… [Read More]
Information System holds in Accounting Industry's future?
Looking through the glass and estimating what the future holds for any individual or profession is always a difficult exercise as the trends in any business or profession may change and so the path of development. It is better to look at the experience of some companies whose systems have changed over the past few years and thus try to estimate what is likely to happen.
There are many changes that have come to the world through the development of Information Technology and Computers. All the changes have come over a relatively short period of twenty years, and in many cases both industry and concerned humans are yet to adjust to the changes. There are many changes which have come in the accounting industry also, and those changes give an idea of what is likely to happen in the future.
The organization where…… [Read More]
A company may be profitable, but not growing, and vice versa, thus affecting leverage (Aggaral and Zhao, 2007).
b. induce a negative relationship between firm value and leverage; conversely, if a firm is perceived with negative or flat growth, leverage is affected. Interestingly enough, new research shows that there are some micro-factors outside of growth that correlate to value and leverage. These include the way a corporation is managed, the size of the Board, the impression of large dividends and lack of focus on shareholder value, and milking of an industry (e.g. yellow pages in the day of the Internet). In addition, certain governmental regulations that are perceived as heavy handed and/or not conducive to growth or -- what is most critical -- perceived growth have considerable negative effects on leverage. Whether this psychological perception is valid or not, the research does not comment -- but it is surprising that…… [Read More]
Even if he hints around in a non-direct way that his friends should sell their stock without coming out and saying it, he may be guilty of insider trading because the information on the merger has not yet been made known to the public.
This is unethical and what the corporate officer should steer the conversation in a different direction and if his friends insist on continuing to ask questions he should firmly, but politely tell them he is not allowed to discuss personal company information with them.
Likewise, an employee has a certain amount of fiduciary responsibility if he knows that there are fraudulent practices happening at the corporation. If the employee knows that there is insider trading or if he knows that the accounting practices the corporation is using are dishonest, then he has an obligation to report what he knows. Some employees, especially if they do not…… [Read More]
Moreover, it is highly unlikely that such a clause would apply in the case of a tort dispute, because the likely plaintiffs in a tort lawsuit would be people who were injured by a misuse of the Technology, rather than any party involved in the contract negotiations. When there is no choice of law provision, the courts look at several different factors to determine which law to apply and whether a court has jurisdiction. In contract disputes, the courts look at the place of contracting, the place where the negotiating took place, where the contract will be performed, the location of the subject matter, and the citizenship and place of business of the parties. In tort cases, the courts look at where the injury occurred, where the conduct causing the injury occurred, citizenship and place of business of the parties, and the place where the relationship between the parties occurred.…… [Read More]
S. is regulated by both state and federal regulations. Both the Securities Act of 1933 and the Securities and Exchange Commission Act of 1934 are federal laws that govern security issuing. he Security Act of 1933 requires that companies fully disclose information regarding their company as well as the security being issued to all potential investors (Megginson & Smart, 2009). he Security Act of 1993 called for the creation of the U.S. Securities and Exchange Commission (SEC) as well as defining what procedures are necessary for the public sale of securities and for the oversight of public companies. his includes the requirement of companies to file a disclosure form, which is referred to as a registration statement, with the SEC prior to beginning to solicit potential investors. Further, this form must be distributed to all potential investors. he SEC must approve the final registration statement before companies can execute sales…… [Read More]
Both proposals were consequently amended and eventually accepted by the SEC.
The audit committee makes sure that the books aren't being cooked and that shareholders are properly informed of the financial status of the firm. Characteristically, the audit committee advocates the CPA firm that will audit the company's books, appraises the activities of the company's independent accountants and internal auditors, and reviews the company's internal control systems and its accounting and financial reporting requirements and practices. The compensation committee usually does the following: (1) recommends the selection of the CEO, (2) reviews and approves the appointment of officers who report directly to the CEO, (3) reviews and approves the compensation of the CEO and the managers reporting to the CEO, and (4) administers the stock compensation and other incentive plans. The suggested committee establishes experience for potential directors (Lunnie, 2007; pg. 90). It also puts collectively a list of candidates…… [Read More]
Over the last several years, Wendy's has been facing a number of different challenges. Part of the reason for this, is their profit margins are being squeezed by: intense competition and declining market share. Evidence of this can be seen by looking no further than, their recent earnings report as the company experienced a loss of $1.4 million dollars for the first quarter of this year. During the conference call, executives indicated that they are looking at strategic options for divesting itself of the Arby's chain. ("No eef with Wendy's Earnings," 2011) This is significant, because it is illustrating how the corporation must use different intermediaries to achieve this objective. To fully understand how this is taking place requires: examining two lenders they are using, two investment banks that they are utilizing to issue equity securities, looking at the roles these intermediaries are playing, what government entities are…… [Read More]
According to the Organization for Economic Cooperation and Development (OECD) defines economic regulations (industrial regulations) as "intervening directly in market decisions such as pricing, competition, market entry, or exit ("Economic regulations," 2002). The main reason for economic regulation is because it is permits the straightforward businessman to succeed in the economy and decrease business relations within the economy from being broken by the illegal activity that takes place (Black, 2010). However, within the economy the market has four different structures that industries are classified under that the government uses to help control the advantages and limitations of supply and demand. The goal of the four structures is to look at how it "affects the outcomes in the market with impacts on the motivations, opportunities, and decisions of economic buyers and sellers through their behaviors within market competition" states Fischer (n.d.). The OECD defines social regulations as an impact…… [Read More]
2. It is not as clear whether Howard has a legal action against Angela, the TNA Director who advised a third party, her friend,
Foster, of Hawke's pending take over of TNA. Angela did not take action to buy or sell stock, rather a third party friend, Foster, benefited from Angela's knowledge via her position as a TNA Director and purchased stock at the rate of $4 per share from Howard
understanding that TNA's Board would fight Hawke's take over attempt and accepting the risk of the outcome of the hostile takeover.
In a Securities and Exchange Commission investigation, Leo would be found to be counsel for the firm representing Hawke in his take over attempt of TNA and thus ethically bound to maintain the confidence/secret plans of his firm's client. In purchasing
TNA stock at a "low ball" rate pre-take over, Leo violated canons of legal ethics and could…… [Read More]
Policy Problem & Proposal
The United States faces a $1.4 trillion national deficit, and partisan debate about how to address it is threatening economic stability on top of the shaky "recovery" from the 2009 financial crisis. Yet American corporations continue to enjoy tax loopholes that reduce their taxes to unprecedented low levels. epublicans argue that corporations must retain their preferred tax status in order to maintain and create jobs. This tax policy has been known by a number of names: supply-side economics, trickle-down theory, and horse and sparrow theory. It has not been without its critics, yet, irrationally, the practice of permitting tax loopholes continues to prevail from time-to-time.
"As for the growth enhancing effects of lower tax rates, just look to the 2000s for the latest persuasive evidence to the contrary. After the Bush tax cuts on the progressive rates paid by the wealthy, GDP between 2001…… [Read More]
, which markets paralegal services to the public, generated about $3.8 million in franchise revenue last year, according to the company's Form 10-K annual report filed with the Securities and Exchange Commission.
Miller, L. (2005) Outsource paralegal work. Trial 41(10), 72-73.
Increasingly, paraprofessionals are going freelance or by contract hours. With a salaried paralegal, if there is a break in the work, he or she may have to do clerical work because there is nothing else to do. A contract paralegal, however, can take on short-term, long-term, per-diem, or per-case projects, depending on what is needed by commissioned assignment. The person is paid only when billing, without the overhead, benefits, or taxes. Contract paralegals can assist with litigation preparation, covering employee absences, and overflow work. Anoutside paralegal can help prepare documents and keep cases moving. A paralegal who is familiar with files can maximize a firm's productivity and minimize costs…… [Read More]
If one particular company has plenty of liquid assets, which therefore assures its progression in future business ventures, then the company has good potential for investing. However, if the company seems to have more current liabilities than assets and capitol, then the investor should definitely look elsewhere.
There are several ways which investors should judge companies in terms of potential investments. One is to judge a company based on their earnings per share, which is calculated through the earnings of the company in the last four quarters. Revenue-Based Evaluations compares companies based on revenues as related to company costs or long-term debt. Investors should also look at a company's cash-flow, or the amount of capitol which actually passes through a company each quarter after that company withdraws money for the cost of maintaining business. Another way is to judge based on the equity of a company, which is judging the…… [Read More]
The political pressure of the past several years following the dot.com bubble and the collapse of several major companies created a need for new securities legislation, which culminated last year in the Sarbanes-Oxley Investor Protection Act, which establishes new guidelines for the securities industry. Initially a Democratic brainchild, the act became favored by epublicans in the House when it was realized that such adjustments would be of great benefit to shareholder value in that they enhanced general financial stability. This is the most prominent piece of financial legislation since the establishment of the Securities and Exchange Commission in the early 1930's. The most widely recognized feature of the new legislation, which was introduced in 1992, is that board members are held personally and criminally liable for the accounting practices that the company employees. This act also establishes guidelines as to the coverage of securities by sell-side analysts who face…… [Read More]
The following till take a look at Foreign Corrupt Practice Act or in other words the FCPA.
Discovering the corporate payments difficulty in the middle of the 70s from a blend of work by the Watergate Special Prosecutor office, this includes related additional work and inquiry by SEC-Security and Exchange Commission and the Multinational Corporations Subcommittee by Senator Frank Church. In 1975, within four months, separate hearings were held by the Church Committee on Gulf Oil, Mobil Oil, Northrop, and Lockheed (Koehler). Every one of these corporations became the main subjects of allegations, concerning uncertain payments made either directly or indirectly to officials of foreign government or foreign political parties bearing a business purpose in mind. For example, the Gulf Oil primarily involved the contributions made to political campaigns of the epublic of Korea President. Northrop was mainly involved in making payments to a general in Saudi Arabia. Principally,…… [Read More]
Enron could engage in their derivative trading strategy with no fear of government intervention because derivative trading was specifically exempted from government regulation. Due in part to a ruling by the Commodity Futures Trading Commission's (CFTC) chairwoman, Wendy Graham, derivatives remained free of regulatory oversight. Ms. Graham, wife of Texas senator Phil Graham, made this ruling 5 weeks before resigning as chairwoman of the CFTC and joining the Enron oard of Directors in 1993.
Derivative accounting is further complicated because there is no consistent way to fairly report their value and risk in a company's financial report. In 1998 Rule No. 133, "Accounting for Derivative Instruments and Hedging Activities" was developed by the Financial Accounting Standards oard (FAS), an independent agency that sets guidelines for corporate auditors. Rule 133 contains more than 800 pages, which further complicates its adoption and consistent interpretation by various companies. SFAS No. 133 was subsequently…… [Read More]
The company which is responsible for assigning the issuers of particular kind of debt obligations and debt instruments the credit ratings is known as a credit rating agency (CA). There are a few cases in which the ratings are given to the underlying debt servicers. It is the special purpose entities, non-profit organizations, companies, national governments and the state and local governments who, in majority of the cases get the securities issued. The credit worthiness (i.e., the ability to pay the loan back) as well as the rate of interest which is applied to a specific security being issued is taken into consideration while assigning a credit rating to an issuer. After the financial crisis which took place in 2007/2009 the value of this kind of ratings was questioned to a great extent. A report was submitted by the Securities and Exchange Commission to the congress in 2003…… [Read More]
The trader must pay the cost of the option ($5.00 x 100 shares = $500). The stick price starts to rise as expected and then stabilizes at $110: before the expiry date on the options contract, the trader can engage in a call option and purchase all the shares of the company's stock at $70, the strike price on the options agreement. The trader pays $7,000 for the stock and can sell the new stock on the market for $11,000, making a profit of $4,000.
Call vs. Put / Seller vs. Buyer
As this paper has already stated, options one the ability, without an obligation, to engage in a security at a set price within a particular time period. With a call option, the buyer has the right, though is not required to buy at a set quantity of a commodity or a financial instrument from a seller by a…… [Read More]
SOC 205 – Society Law and Government 1
The Enron (Kenneth Lay and Jeffrey Skilling) Trial
Summary of the Trial
The Enron Trial dates as one of high profile case of corporate fraud in the US. Enron was founded in 1985 by Kenneth Lee Lay and was reported as the largest seller of Natural gas in North America by 2000. The American energy company recorded a spectacular rise with revenues increasing to over $100 billion in 2000 from $9 billion in 1995 and an increase of Enron’s stock prices recording a high of US$90.75 per share. Enron Corporation was ranked consistently as America's Most Innovative Company" between 1996 and 2001 by Fortune Magazine. The end of 2001 saw an unprecedented collapse of Enron’s stock price from US$90.75 per share to less than a dollar following an announced of $1billon loss in the first quarter of 2001 and resulting to declaration…… [Read More]
Prior to the corporate financial scandal, WorldCom was one of the largest long distance telephone companies (euters, 2003). Initially headquartered in Mississippi it later moved to Virginia. The company grew fast by acquiring other companies such as MCI Communications in 1998 and UUNET technology in 1996. Other companies acquired included, Metromedia in 1992, esurgens Communications Group in 1993. In the course of this acquisition spree, WorldCom undertook two complex takeovers. The first was the 1998 acquisition of CompuServe from H& Block where it retained the network division, sold off the online service to American Online (AOL) and the second, the acquisition of Digex in 2001, and disposed of all Digex assets to Allegiance Telecom (Kaplan & Kiron, 2004). With these acquisitions, it gained a favorable reputation in the market as a company with a solid foundation.
Facts of the WorldCom Case
The WorldCom fraud case is one of the…… [Read More]
finance and financial entrepreneurship. The basis of the article is on a discussion that was held on this subject among four leading lights of financial entrepreneurship in the United States - Michael Milken, Lewis Ranieri, Richard Sandor and Myron Scholes. These people are famous in their own right and have had a sizeable role in financial entrepreneurship in the U.S. over the last 20 years. We have first discussed their achievements to get a clear idea about their personal achievements. This would certainly give a clear idea of what is possible in the U.S. today. They are of course interesting characters and one has to remember that the ideal entrepreneur of the 21st century cannot be thought of as an updated version of Henry Ford. After the discussion of the people, the meeting and the discussions held there are summarized. ased on the total information collected, we have come to…… [Read More]
Also cited as threats are those of:
(1) Product manufacturing and marketing risks;
(2) Cost and expense control or unusual events; and (3) Changes in laws and accounting standards. (Pfizer Inc. Report to the United States Securities and Exchange Commission, 2008)
IV. Internal Environment -- Strength and Weaknesses
Stated as strengths of Pfizer Inc. are the following components of its organization:
(1) Written policies and procedures;
(2) a compliance officer and compliance committee;
(3) Effective training and education;
(4) Effective lines of communication;
(5) Internal monitoring and auditing;
(6) Enforcement through discipline pursuant to established guidelines; and (7) Prompt response and corrective action for detected problems.
(Pfizer, Inc., 2009)
Another component that provides strength to Pfizer Inc. is its effective training and education program. As well Pfizer boasts effective lines of communication including an 'open door' policy allowing and encouraging colleagues to "discuss any issues, concerns, problems and suggestions with…… [Read More]
In this segment S&W competes with Beretta from Italy, Heckler & Koch from Germany and Fabrique Nationale from Belgium. The most dominant competitor in this segment is Glock of Austria, which sold 50,000 Glock Model 19 pistols to Iraqi Security Forces without the consent and approval of U.S.-based collation command or the U.S. Congress. Glock, in refusing to cooperate with the U.S. military, has opened up a significant opportunity for S&W in government markets based on the conflict Glock has created and the preference of Congressional members to buy from domestic suppliers.
Available Substitute Products
There is an abundance of substitute products as the handgun marketplace is fragmented with nine different manufacturers, each with between 5% to 14% market shares. Glock and their innovation in polymer pistols and firearms revolutionized the industry in the 1980s, yet S&W was able to regain their market share by working with distributors, dealers and…… [Read More]