CEO & CFO Perceptions About AIS Impact on Firm Performance & FInancial Reporting

On an overcast afternoon in Portland, Oregon, on Friday, March 28, 2003, Richard Okumoto intently studied a set of hard-copy accounting documents called “adjusting journal entries” spread out on his desk. He had been appointed chief financial officer (CFO) of Electro Scientific Industries, Inc. (ESI), a multi-million dollar equipment manufacturer, just a few weeks earlier. Okumoto was in the midst of closing the company’s books for the third quarter of fiscal year 2003, which ended February 28. An experienced executive who had served as CFO for several other technology firms, Okumoto was familiar with the task, which normally would be routine. But this time, he

Arel, Beaudoin, Cianci, (2011) argue that "executive ethical leadership and an "high-quality" internal audit function, can positively guide accounting managers ' making decisions involving uncertainties."

Such an intense focus has been placed on quarterly earnings as an indication of a company’s success by everyone from analysts to executives that ethics have for the most part been thrown out the window, sacrificed to the all important number, i.e. earnings per share. This is the theory in Alex Berenson’s book “The Number: How the Drive for Quarterly Earnings Corrupted Wall Street and Corporate America.” This number has become part of a game to be played, a figure to be manipulated – beat the number and Wall Street all but throws a parade, miss it and a company’s stock may be abandoned. Take into account the incentives that executives have to beat the number and one can find plenty of reasons to manage earnings.

The chances of failures can be decreased by executing the checks on the systems. These keep an eye on the systems preventing risks from occurring, and these checks are avoided as the interior controls. The motivation behind the inner controls is to keep the organization safe from risks associated with the modernized accounting-system risks. Organizations change their manual accounting systems to computerized accounting systems for different reasons, this incorporates the points of interest, and the explanation behind utilizing electronic accounting information is instinct. The organizations embrace the policies of their

Financial reporting practices and ethics have manifested an ocean of literature. This has mainly come from organization theorists that address accounting practices. These theorists and professionals have given fresh accountability measures. Their ideals give this industry the tools needed to survive, grow and prosper. The way an organization prepares and reports its financial information and handles its daily operations is in essence financial practices, and in the way it accomplishes this reveals their ethical standards to which they adhere to. This paper will discuss the financial practices, ethical standards, and

S., & Hassan, M. K. (2012). The domination of financial accounting on managerial Commerce & Management, 22(4), 306-327. doi:10.1108/10569211211284502

An effective system of internal control must be built on the basis of the analysis of enterprise-wide risks. Therefore, to create value for its customers and other stakeholders, an organization must have in place the ability to systematically assess and analyze all material risks that affect the entity’s planned objectives. (Integrated Framework, Volume II Guidance, June 2008). Internal control of the accounting process is designed to detect unintentional data errors rather than intentional errors. Garbage in, garbage out! Even good accounting systems can not catch

Part of ABC’s Finance Director’s justification for manipulating the financial results is that: “a win-win situation for everyone”. This section will explore the impact of ABC’s creative accounting practice to the interest of different stakeholder groups. It will also identify the winners and losers if the finance director’s proposals are carried out.

Information technology can be very costly, and it is imperative for organizations not to overspend when it comes to their IT budget. However, it is vital for organizations to understand the risks associated with information technology. As we saw in the TJX case, TJX’s senior management did not update their systems and had very little IT knowledge. This led to multiple risks involving several security breaches which could have been contained by improving their information systems more efficiently. It is not just developing and implementing information technology; it is also understanding risks and formulating solutions to issues associated with IT. In Adventures of an IT Leader, Barton faced many challenges when it came to the budget of IVK. He assumed full responsibility for all the risks associated with the technology used and the IT budget. When the power shut off at IVK, Barton was faced with many challenges including possible customer records compromised, IVK’s systems infected, and deciphering solutions to secure the system. Barton suggested that IVK shut down operations to build a new and secure system to ensure IVK’s systems could identify where the infection originated and repairing the system for future

Armstrong and Dennis R. Balch in the Journal of Legal, Ethical and Regulatory Issues, Volume 18, Number 2, 2015 they interview two former Chief Financial Officers, Aaron Beam and Weston Smith to conduct qualitative assessment using the Banality of Wrongdoing Model. During the assessment Mr. Beam and Mr. Smith were asked fourteen questions to gauge “the culture of competition, ends-biased leadership, missionary zeal, legitimizing myth, the corporate cocoon, banality of wrongdoing and greed.” The authors of this study concluded that Mr. Beam and Mr. Smith did not attempt to justify or rationalize their behaviors or their part in unethical practices and accounting fraud but rather admitted to being fully aware of their actions and knew the ramifications of doing such. Rather than trying to justify their behaviors it became more of anxiety and stress to both of them, however they “used the defense that they were more or less forced into the behavior by the Chief Executive Officer, Richard

SNC-Lavalin Group Inc. is an engineering and construction company headquartered in Montreal, Canada. It is one of the top five global design companies in the world. The company has been involved in major engineering and construction projects in the world in Canada, Madagascar, Australia, and Spain. The company has more than 30,000 employees and a turnover of over 6 billion Canadian dollars. Recently in March of 2012, the company's CEO, Pierre Duhaime resigned as a result of breach of accounting ethics. It was found that the CEO had misallocated payments to agents totaling to $56 million. This included $33.5 million which the company's chief financial officer and another company executive had refused to sign off on ADDIN EN.CITE Lemer2012284(Lemer, 2012)28428423Jeremy LemerSNC-Lavalin head resigns over 'breach of ethics'Financial Times2012New YorkThe Financial Times Ltdhttp://www.ft.com/cms/s/0/5549bce4-7760-11e1-827d-00144feab49a.html#axzz2AEVBzXtxOctober 25th 2012( HYPERLINK l "_ENREF_2" o "Lemer, 2012 #284" Lemer, 2012).

This study aims to understand what effect has an ethical framework in accounting. In particular, we examine the influence of ethics on earnings management, financial reporting, and external accounting. Today, the commercial environment reveals the unethical behavior of management and accountants through the manipulation of accounting records to boost the company’s stock price, falsified financial statements to mislead investors, failure of auditors to correct errors and omissions due to client’s pressure and personal material interests.

Q1. I classified the following controls based on what I read in appendix 1. For IT General Control, it talks to controls that are set in place so that a client's IT system operates correctly. These controls primarily focus on ensuring that changes to applications are properly authorized, tested, and approved before they are implemented and that only authorized persons and applications have access to data, and then only to perform specifically defined functions. Because of this, the physical access to the server room has been classified as an IT General Control. For Application Control, it talks more to automated controls that apply to the processing of individual transactions. They include such controls as edit checks, validations,

Ethical and legal obligations apply to all members of society. As one in society, the obligation to act in an ethical, law abiding manner on a daily basis is vital to the integrity of daily life. Many professions have their own code of ethics. Financial reporting is not exempt from such ethical and legal standards. One’s lively hood depends on decisions made in the business world. Business transactions are done daily and can impact one’s economic stability. Trust is placed in the hands of corporate America and an obligation of financial reporting to reveal a complete honest and legal picture of an entity’s accounting practices is important in attaining trust. This paper will discuss the obligations of

ABSTRACT: Information Technology General Controls (ITGCs), a fundamental category of internal controls, provide an overall foundation for reliance on any information produced by a system. Since the relation between ITGCs and the information produced by an organization’s various application programs is indirect, understanding how ITGCs interact and affect an auditor’s risk assessment is often challenging for students. This case helps students assess overall ITGC risk within an organization’s information systems. Students identify