The employees must keep company’s tangible assets and knowledgeable things. The company and its employees have obligation to protect their tangible and intangible assets. Generally, the protection of assets is most important part in profit entities. County of San Diego and G.M Financial conduct their businesses that elementally trust employees. Nevertheless, the reason that company adopts the code of ethics is forbid to fraud, theft, and corruption by
Each measure is taken to maintain accuracy and reliability in daily operations. Internal controls help to protect the company’s resources against theft, fraud, and errors. Internal control is like checks and balance systems to verify everything is in order. There are different levels or components of internal control. There are controls that prevent mistakes or errors from occurring.
Objectivity and independence remain free from conflicts of interest and other questionable business relationships when conducting accounting services. Not doing so may hamper an accountant ability to provide honest opinion about a company’s financial information. Due care requires accountants to observe all technical or ethical accounting standards. Ethics Case 1-8 (concluded) Ethical issues or challenges: 1. Fairness is one because auditors should treat every company the same way no matter what.
Full disclosure requires that publicly traded businesses use accrual based accounting and revenues are recognized as sales are earned. Full disclosure also requires that footnotes describe accounting procedures and provide details for unusual transactions. With companies such as Enron and WorldCom, the accounting field has an increased need for businesses to tell the truth in its financial statements. Full disclosure acts as the obligation for businesses to be truthful in its statements in order to protect the parties
There are not enough regulations and monitoring system for the daily accounting activities. For instance, management and auditors spend very little time reviewing the insignificance of petty cash account. So the five elements of internal control is not work well in this company. The control environment was not effective; there was no effective risk management, which helped the company to realize its objectives; control activities and monitoring are lack. Moreover, the CEO is ultimately responsible for the internal control who assumes primary responsibility for the system of internal control.
If customers are visiting their local industrial "supermarket" these facilities do not display MWX prominently and the 14 person sales force dedicated to this product are unable to educate large numbers of sales reps and end-users on the benefits of MWX. Most biocide maintenance products only work with 45% of metalworking fluids; if customers had a bad experience with these products they may not think it is a product useful for their
There is no proper linkage between corporate HR structure and operations at the plant level. In other word there is no chain of command kind of linkage between them. It seems that operations office can do the HR functions by themselves like hire and fire which is in fact corporate HR department’s sole function. The leave reason seems to be written by the supervisor not the employee, this is not logical. 2.
Lack of a shared vision and lack of responsibility: Although as stated earlier, the vision statement had not significantly changed, the implementation of new ideas was never shared completely. Managers had a vague idea of what was happening corporate wide, but could not disseminate this information in a functional manner. Essentially there was little dialogue between upper management, mid level and staff. Management itself was divided into teams. They separately would try to communicate with staff, usually during lunch breaks.
The organization in charge of validating the EPAs did not record whether there was risk for financial abuse or not; it only recorded whether the older person had impaired capacity and whether an administrator for the assets was necessary. Some of the files obtained from the sample were labeled “suspected abuse,” and never followed up on. The study did not take into account that some appointed administrators were the older persons’ partners who were also at risk of having failing capacity to manage their assets. Informal access – assisted withdrawals where the older person signs the checks – was not accounted for in this article, and it was not legally sanctioned either. At the same time, the effectiveness of the data collection was relatively limited due to the lack of professionals trained in this
Carter and George thought that it’s ok to achieve the results, no matter what means they’ve used. And Joe thought that it’s ok to cover up the whole thing. What’s worse, there’re opportunities for fraud since the internal control in this company is so weak in the sense that there’s no formal written procedures, no segregation of duties, no good accounting system, and no physical security protection for inventory. Employees are given access to records and valuables in the ordinary course of their jobs. Unfortunately, that access allows them to commit fraud.