Company Background: Computer Associates

When analysts question a firm’s earnings quality, it raises concerns regarding under or over aggressive accounting practices that may be allowing the firm to manipulate the earnings. Earnings quality is defined as the strength of the current earnings in being used to predict future earnings and cash flows. Since earning quality is indicative of future performance, analysts are more likely to address issues that have substantial impact on the earnings quality. An issue arises when the nature of the earnings is questioned. While permanent earnings are part of normal operations, any irregular, one time earnings can skew the earnings, making the firm look more profitable than it is. This is due to the inability to recreate similar one-time transactions that will give rise to such numbers. Investors prefer predictable

I am very interested in a career field in Human Resources. For this paper, I interviewed Lillian Mannino who is a Human Resource and Personnel Manager at the UC San Diego Graduate School of Global Policy and Strategy. As a manager, Lillian serves as the link between the graduate school’s management and its employees. She is in charge of overseeing recruitment, employee relations, policy development, payroll, and benefits. Personnel management is a special branch of management that is focus on the concerns of employees at work and their relationship with the organization. Her educational experiences consist of a bachelor degree at UC San Diego in Management Science and a professional Human Resources certificate from UCSD Extension. She has been working in the academic administration for almost ten years and earned her current position as manager through climbing up the ladder. She started off working in this field as a student affairs officer then was promoted to an administrative specialist. Her prior work experience paved a path for her to build up professional experience as well as a solid network within the UCSD administrative system.

If this change never occurred, the company would had never had such enormous loss in

Because they have faced cash shortage trouble. Their profitability has grown for 1993 ~ 1995 period, as we can see from their I/S (e.g. Sales and Net Income, etc.). However, as its business size grows, their A/R increased, which means that it is getting difficult to collect cash. On the other hand, A/P decreased for the same period, which means that the company paid cash for A/P, resulting in critical cash shortage. Furthermore, the A/P payment period is shorter than A/R collection periods, the company’s cash problem happens to be accelerated.

The reason is that the company’s expenses exceeded the revenue. Company’s assets have been increasing compared to last year total assets. There hasn’t been a dramtic change in liabilities because the company doesn’t have enough cash to pay its debt.

Career Tech will provide me with an environment of friends that are dedicated to the same level of education I am. Career tech meets my family’s standards. It provides a way for me to get a great academic foundation and continue playing for Wasilla Warriors basketball team. I believe Career Tech will boost me into my future and my road to college.

I started volunteering at Visually Impaired Preschool Services and Kentucky School for the Blind for a service in high school. I loved working with students there and that I wanted a job that I would love to going to everyday. I also feel that students with special needs are seriously underestimated and I want to help those students succeed.

3. The new system allows charging additional services required by the clients, generating more revenue.

Pro forma financial statements are made to reflect a purported change, such as a merger, something acquired, or to give emphasis to specific figures when a corporation issues an earning announcement publicly. Investors need to be cautious when reading

Change in revenue criteria increased both sales and cost of sales by $ 28 Million. The profit margin was decreased from 1.55% to

Are the financial statements a fair representation of the organization’s financial position? How do you know?

The new standard includes a five-step model, which applies revenue recognized from a contract customer, regardless of industry type and nature of the contract. However, there will be a limited list of exceptions to the standard. The standard will affect the reporting for all entities in all industries unless the exceptions apply. It also increases requirements for extensive footnotes, due to new information pertaining to performance obligations, changes in account balances between periods, and disaggregation, or breakdown, of total revenue.

The cash flow situation started falling from the end of year 12. The company should have known from this.

Assignment Question 4: Prepare an analysis of the revenue change, separating the volume effect (increase in number of consultants) from the productivity effect (billing percentage).

As stated in Exhibit 3, Earnings management is the managerial use of discretion to influence reported earnings. Within the accrual accounting system, managers have significant discretion with their firms’ accounting choices. Management has the ability to make choices that can opportunistically lead to higher or lower reported earnings. Richard 's and Ira Zar’s (CFO) actions would not change if these results were the result of GAAP flexibility because he violated the rules of accounting, the conceptual framework principle of neutrality in numerous ways to report the financial results that CA did under false pretenses. It would be one thing if CA garnered these results through legitimate business decisions versus using accounting tactics like changes in accounting estimates or outright fraud as in the use of the 35 day Month. The purpose of which was solely to allow CA to meet or exceed analysts’ estimates.