George Zimbardo—psychologist and professor at Stanford University conducted prison experiment to test the effect of situations. In contrast with prediction as lengthy and boring‚ the experiment’s result shocked the world. The Stanford Prison Experiment (SPE) has indicated the significant power of roles‚ or situations‚ on human behaviors; thus‚ brings about many influences on society. According to Zimbardo in “ Obedience to Authority‚” he asked the students during the spring term to reverse role and
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GAAP / IFRS Fiat Group’s first-time adoption of IFRS Differences Between Key Accounting Methods Under Italian GAAP And IFRS What characterizes the differences between the two sets of methods? - Substance over form Example: Recognition of revenue - Less flexibility Example: Recognition of R&D cost - More transparent Main factors that affect management’s reporting incentives and strategy in fiscal year 2005 - Research & Development: Because Fiat main operations are based on the manufacturing
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How did the corporate culture of Enron contribute to its Bankruptcy? Once a sound company listed in fortune 500‚ Enron‚ lead to downfall because of deceptive accounting system incorporated within the organization. Enron’s dubicious finance finally collapsed in Dec 2‚ 2001 as it filed Bankruptcy in New York Bankruptcy court. The corporate culture of Enron focused on financial performance neglecting the stakeholder’s value .The relentless emphasis on the importance of the shareholder’s value created
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ABONG Rose AKENJI 13200149 Question 1 Is the Enterprise a VIE as defined in the Codification Master Glossary? If so‚ what criteria cause it to be deemed a VIE? Assume that (1) the Enterprise does not qualify for any scope exceptions and (2) the equity investment by the Nominee Shareholders in the Enterprise represents equity investment at risk. The enterprise is a VIE as defined in the codification of the master glossary. From the narrative‚ nominee equity holders do not absorb the losses of the
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It was the biggest bankruptcy in US history and cost 4‚000 employees their jobs. 1.1 The Reasons for Scandal Top Level Management & Board of Directors – Enron Bent the Accounting rules to satisfy their own desires to earn short term profit SPE Laws Accounting Laws The Immoral and unethical actions taken to achieve personal profits Violated Top Level Management & Board of Directors –
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exercise prudent judgment‚ failed to challenge management when necessary‚ and‚ as a result‚ failed to adequately protect the interests of the shareholders. 9. Identify the conflict of interest in: SPE activities‚ Arthur Andersen’s activities‚ and Executive activities. The conflict with the SPE was that Enron was keeping their losses off of the end of year reports to offset other dealings that were not profitable. If true numbers had been reported losses would have been seen and not covered
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Learning Outcomes and Assessment Feedback Name of the Assessor Learning Outcomes Assessment Criteria (AC) Assessor Feedback LO 1 Understand the relationship between strategic management and leadership 1.1 Explain the link between strategic management and leadership 1.2 Analyze the impact of management and leadership styles on strategic decisions 1.3 Evaluate how leadership styles can be adapted to different situations LO 2
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IBCCI’s Misgivings: Four major frauds explained in the Price Waterhouse report. 1. According to the Sandstorm Report‚ some $633 million of losses related to treasury trading. 2. Price Waterhouse had been doing its job‚ there’s no way that this $1 billion exposure [in BCCI’s Central Treasury] which was taken to $11 billion exposure in the course of 3 or 4 months [in 1985] could have happened. 3. All of BCCI’s serious treasury problems were related to the activities at Grand Cayman
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disaster is the approval of the structure of Special Purpose Entities (SPEs) that were used to generate false profits‚ hide losses and keep any unfavourable information out of Enron’s consolidated financial statements. 2) Which Arthur Andersen decisions were faulty? During auditing of Enron’s documents‚ AA has made many decisions which led to their downfall. AA has approved for the structure of Special Purpose Entities (SPEs) which generate
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In the recent years Redlands Manufacturing‚ Inc. has been audited and subjected to constant fiscal penalties due to fraudulent financial reporting on the companies part. Due to the following incorrect procedure the company has had to paid a tremendous amount fines: Channel Stuffing: Incorrect Practice: For financial gain‚ Redlands Manufacturing‚ Inc. shipped equipment to vendors with out a full merchant agreement and agreed to except returned merchandise back if it was not sold by yearend
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