Accounting for corporate accountability Essay Example | Topics and Well Written Essays - 2000 words

Accounting for corporate accountability - Essay Example Post-modern corporate business has become a powerful economic force in the industrialized world.Accounting practices are currently focused on corporate accountability, which involves the understanding of current concerns regarding responsibility and accountability to stakeholders. Post-modern business discourse is focused on the economic and social consequences of corporate practices (Elliott and Elliott, 2006). Transparency, though, must also take into account the subjective nature of gathering, analyzing and presenting data as published accounting information. The fear that corporate managers might act contrary to the interests of shareholders and not be concerned with those with whom the corporation contracts (creditors, workers and consumers) is of primary concern (Benston, 1982; Schreuder and Ramanathan, 2002). Others may be harmed by corporate actions (externalities). The ways in which social responsibility accounting can be used to measure and serve as a means of controlling e xternalities is of research interest.Revenue recognition practice is an ambiguous accounting term, in that there is to date, no internally standard definition. This complicates the process of making comparisons within and across companies. A popular characterization of the concept is that revenue recognition practices are revenues that should not be recognised by a company until it is realised or realisable and earned by the company (Elliott and Elliott, 2006; Turnover, 2001). ... The IASB requires four tests: (a) the amount of revenue can be measured reliably; (b) it is probable that the economic benefits associated with the transaction will flow to the entity: (c) the stage completion of the transaction at the reporting date can be measured reliably; and the costs incurred for the transaction and the costs to complete the transaction can be measured reliably (Leo, Hoggett, Sweeting, & Radford, 2005, p. 75).This paper aims to review the recognition revenue of iSOFT in 2006, which had a revenue recognition adjustment of 174 million due to overstating revenue for long term contracts. A change in accounting policy by the board for future recognition has been implemented in the 2006 Report. And goodwill impairment write-off has resulted in a loss for 2006 financial year. Investigation continues into these issues. A brief background of ISOFT Corporation will first be provided. Secondly, a critical review of the consequences of the change on economic and social dimensions will be presented. Finally a conclusion will synthesise the main points and show support for an internationally standard definition of revenue recognition, and for the adoption of accrual accounting methods. Background of iSOFT.iSOFT is a global leader in the supply of medical software for health care services. Over 8,000 organisations across 27 countries use iSOFT products and services; an innovative company with several target markets specializes in software design, development and solution delivery (iSOFT Annual Report, 2006). During the latter half of the 2006 financial year many changes were taking place for iSOFT, and the January trading statement, together with a related trading update issued on 28 April 2006, had a negative impact on the Group's

Business law - situational question Essay Example | Topics and Well Written Essays - 750 words

Business law - situational question - Essay Example In fact, the terms of the owners of the parking garage could be considered to be legally unreasonable and therefore there could indeed be grounds for a law suit against them. This is due to the fact that within the UCTA 1977 Act and the Unfair Terms in Consumer Contracts Regulations 1999, there have been many clauses within company terms rendered ineffective due to the fact that they are totally infeasible (MacDonald 2004, p. 69). Of course there have been many cases that have been variant from this one which have been found to hold unreasonable terms and therefore the party of each case was held responsible for the adversities that arose to the defendants. These could be cases of faulty goods and the terms of sale unreasonable, or it could be of cases stemming from an even simpler nature. One case that was found to have unreasonable terms and of which the defendant won was in AEG Ltd v. Logic Resource Ltd (Bradgate 1997, p. 582). Of course though this was not a case that involved any form of injury to the defendant it could have resulted in loss of profit and adversity for the company. Therefore based on the laws of the UCTA 1977 Act, the defendant was awarded that which he was asking in the case due to the unreasonableness of the plaintiff's terms in the contract. This could be viewed in a similar light in regards to Helen's case and the terms in the parking garage. ... Therefore, for reasons such as these and others similar, the UCTA 1977 Act looks at all occurrences, not simply injury related ones. In Helen's case the terms are obviously unreasonable(as has been stated) and in that regard can not be binding as a form of protection for the owners to not have to face negligent charges and restitution damages by the defendant, which is Helen. Furthermore, because the notice in the garage and the memo are not incorporated logically then there is a definite unreasonable factor being presented. Helen might have assumed that the threat of injury or danger to her body or car was only slight because she was not aware of the falling debris in the garage due to the construction. However, the London Shoe company was aware of the construction and therefore, as was stated should have known to shut down the parking garage until the construction was totally completed so that there would be no unfortunate accidents or injuries. Yet the company failed to do this an d it resulted in a very adverse outcome for Helen. The owners of the parking garage definitely can not deny a "sense of liability" to Helen due to the fact that they did not properly post about the construction in the parking garage and the construction in itself deviated far from any minute injury or adverse occurrence that could have taken place at any other time in the garage (Barmes 2004, p. 435).Furthermore, since the contract with the parking garage assigning parking privileges to employees seemed to be breached then the owners themselves have a liability to the defendant as has been stated. The reason that there was a breach is due to the fact that the circumstances surrounding the parking garage changed when the construction took