Revenue Recognition and Corporate Governance

Revenue Recognition and Corporate Governance Revenue recognition is one of the most important accounting concepts to organisations across the globe. Basically, there are two main ways in which an organisation can account for revenue as part of their financial accounts. A company can either use cash based accounting or accruals based accounting. Cash based accounting requires the company to recognise the revenue and to put the figure into their accounts at the point when the cash is received, regardless of how or when the money has been earned. On the other hand, with accruals based accounting the figures will feature in the accounts when the revenues are realised, or when the amount is earned, not necessarily when the cash actually enters the company[1]. Countries across the world deal with the issue of revenue recognition very differently and, as such, it is particularly difficult to compare international businesses. The way in which revenue is recognised will have an impact on the perceived financial health of an organisation and different approaches can make it extremely difficult for analysts and investors to make a fair comparison. In October 2002, the International Accounting Systems Board (â€Å"IASB†) and the Financial Accounting Standards Board (â€Å"FASB†) began a joint project to deal with these differences. The original overall aim of the revenue recognition project was to establish a single coherent way of revenue recognition that can be used, globally. Fundamentally, this required the convergence of US GAAP and international standards. One of the main problems facing FASB and IASB is that the US does not have a general accounting standard relating to revenue recognition. Instead, different sectors and industries have developed their own ways of dealing with revenue recognition in line with their individual requirements[2]. As a result, there is no consistency. Moreover, revenue recognition in the US is seen as particularly complex and is based largely on the discretion of the individual finance teams. Originally, the project suggested that a fair value asset based approach should be followed. However, it is currently thought that it will not be possible to establish one universal approach. The basic concept of the fair value asset and liability approach is that when a company enters into a contract, it creates rights (assets) and obligations (liabilities). The difference between these assets and liabilities at any point in the contract is the revenue generated by this contract and should be the figures used at the point in which the accounts are drawn up. This started as a fair value approach to the difference in assets and liabilities, but has now shifted more towards the customer consideration approach to valuing the difference between assets and liabilities[3]. The FASB and IASB have since recognised that enforcing one standard on a global level will be impossible and have, since 2006, decided to take a more bottom-up approach by conducting an international study of how the above model would work and the way in which it would interact with the cultural differences across the globe[4]. It is this cultural difference and historical freedom that presents the greatest challenge to the success of the project. Without a detailed understanding of how the proposed models will work, practically, with reference to the various different families of transactions, it will be impossible for the project to reach any definitive conclusion. For this reason, gaining a greater understanding has now become the first and most important priority of the FASB and the IASB when conducting their study relating to revenue recognition. Corporate governance is absolutely vital in the administration and control of companies. Essentially, corporate governance refers to the principles, policies, customs, laws and any other factors that deal with the way in which a company is managed. It is key in the way that the relationship with the company directors and the stakeholders in the company interacts. As a general rule, strong corporate governance results in a good level of confidence in the company itself and the wider industry[5]. The aims of corporate governance are multiple but are mainly in relation to accountability of the key individuals within the organisation and, in particular, the way in which the company deals with the principal – agent problem[6]. It is also about establishing economic efficiency and ensuring the best and most appropriate use of available resources. As the way in which companies are run varies so dramatically from country to country, it is unsurprising that the way corporate governance is managed is equally diverse. In 2002, the United States took the approach of regulating the way in which corporate governance should work with the Sarbanes-Oxley Act. This Act was drawn up as a rule based approach to corporate governance, following several accounting scandals which hit the headlines in the US, the most notable being the collapse of ENRON. As part of the legislation, eleven heads of rules were created and the Securities and Exchange Commission was required to make compliance a condition of admission to the exchange. The rules have been criticised as being highly prescriptive and not allowing for flexibility based on organisational differences[7]. Contrast this with the principles based approach taken in the UK and the US. Although both countries follow the Anglo-American approach, which is considered liberal and as giving priority to shareholders, the way they go about achieving this aim is substantially different. The UK takes a principle based approach with a ‘comply or explain’ policy[8]. This means that a list of principles and best practices has been developed in relation to corporate governance whereby public listed companies must either comply with this best practice or explain why it is not thought necessary in their particular circumstances. In the US, there are statutory rules with which all accompanies must comply. The UK government felt that it was not possible to create one set of rules that would capture the needs and issues of every type of company; for this reason, it has continued to favour this principle based approach. Divergences in the way that corporate governance is dealt with across the globe and even across sectors and industries is a natural part of the way business is conducted. All companies have their own issues and structures which require different approaches to control and accountability. The level of prescription that the US government has placed on corporate governance has resulted in a one size fits all approach which is simply impractical. Failure to allow a degree of flexibility and adaptability will result in a difficult to manage and ineffective system of corporate governance. Footnotes [1] Sondhi, Ashwinpaul C., Taub, Scott, Revenue Recognition Guide, Cch Inc, 2006 [2] Benston, George J., Bromwich, Michael, Litan, Robert E., Wagenhofer, Alfred ,Worldwide Financial Reporting: The Development and Future of Accounting Standards, Oxford University Press US, 2006 [3] Sondhi, Ashwinpaul C., Taub, Scott, Revenue Recognition Guide, Cch Inc, 2006 [4] Glover, Jonathan C., Ijiri, Yuji, Levine, Carolyn B., Jinghong Liang, Pierre, Separating Facts from Forecasts in Financial Statements, Accounting Horizons, Vol. 19, 2005 [5] Colley, J., Doyle, J., Logan, G., Stettinius, W., What is Corporate Governance ? McGraw-Hill, December 2004 [6] Clarke, Thomas (ed.), Theories of Corporate Governance: The Philosophical Foundations of Corporate Governance, London and New York: Routledge, 2004 [7] Monks, Robert A.G, Minow, Nell, Corporate Governance, Blackwell, 2004 [8] Arcot, Sridhar, Bruno, Valentina,d Faure-Grimaud, Antoine, Corporate Governance in the U.K.: is the comply-or-explain working?, FMG CG Working Paper 001, December 2005

D. Virginiana (Didelphis Marsupialis) Essay -- Biology Animals Researc

D. Virginiana (Didelphis Marsupialis) The text of this paper will cover a description of D. virginiana, its ecology, history, and research involving the species. The first topic to be discussed by this paper is a description of D. virginiana, which was until recently referred to as Didelphis marsupialis. The description of the opossum will start with a taxonomic description of the species. Following, will be the opossums appearance, and last will be the life cycle of the noted species. The opossum, Didelphis virginiana, takes its name from two different languages. The name Didelphis is made up of the two Greek words â€Å"di†, and â€Å"delphys† which stand for â€Å"two wombs† referring to the female opossums paired reproductive tract. The name â€Å"virginiana†, means â€Å"of Virginia† in its Latinized form. This refers to the where the first scientific specimen was found and catalogued (The Georgia). The taxonomic classification of the opossum is as follows: Domain: Eukarya; Kingdom: Animalia; Phylum: Chordata; Class: Mammalia; Order: Marsupialia; Family: Didelphidae; Genus: Didelphis; Species: Virginiana (Savage 45). The appearance of D. virginiana is quite unique. It has a length of approximately 650 – 900 millimeters (25.4 – 35.1 inches), and a weight of approximately 1.8 – 4.5 kilograms (4 – 10 pounds) (Yahner 11). The opossum has a gray, or black, hair color scheme, with a scaly prehensile tail (Merritt 33). The forefeet and hind feet both have five clawed toes. However, the hind big toe is opposable and resembles a thumb (Merritt 35). The opossum, being a marsupial, also has a pouch (Yahner 11). The life cycle of Didelphis virginiana is quite interesting, ... ...bdominal cavities of the given marsupials, and enclosing them in pens at a constant temperature, the researchers were able to get more exact mean body temperatures for the marsupials. They were also able to find the circadian, or twenty-four hour, rhythms in the body temperatures of the marsupials. The mean body temperature for D. virginiana was found to be 35.1 degrees Celsius, with a range from 33.8 to 36.3 degrees Celsius. The lower range of the temperature was found to be during the day. The results for D. virginiana were similar to previous calculations of mean body temperature. The data from this study was compared to eutharian mammals, which showed similar differences among their species (Gemmell). In conclusion, the text of this paper has covered a description of D. virginiana, its ecology, history, and research involving the species.

Plot Summary: Volpone, by Ben Jonson Essay

Ben Johnson was an Elizabethan English poet, dramatist and actor. A peer of William Shakespeare, Johnson was born in 1572 and died 65 years later. He was a man of extraordinary literary talents and despite the fact that he didn’t go to university he was acknowledged as one of the most learned men of his day. He was friends with many of the other well known Elizabethan writers like Bacon, Shakespeare and Donne; in fact, Shakespeare even acted in the 1616 production of Johnson’s play ‘Every Man in His Humour’. Johnson is best known for his poems and satirical plays, of which the 1606 ‘Volpone’ is considered to be one of his best examples; it is a comedy/satire about avarice and lust The play takes place over 24 hours in seventeenth-century Venice, and opens at the home of a nobleman from the city – Volpone (the ‘fox’). Seemingly, this nobleman is actually a con artist who has gained his impressive wealth through deception and other dishonest ways. As the play starts, Volpone is with his servant Mosca entering the shrine where Volpone keeps all his wealth and treasures. The reader learns that Volpone is about to deceive yet more people as he tries to trick his alleged friends – Voltore (the ‘vulture’), Corbaccio (the ‘raven’) and Corvino (the ‘crow’) – into believing that each is Volpone’s heir and that he is actually on his deathbed. What these three men do not know is that Volpone is in perfect health and feigning his illness to receive expensive â€Å"get well† gifts from these fortune hunters. Mosca, Volpone’s â€Å"parasite† tells each of the men individually that they are heir to Volpone’s fortune so that they will return with yet more gifts. Voltore, who is a lawyer by trade, offers the ‘dying’ man a gift an expensive platter, the old gentleman. Corbaccio is talked into disinheriting his son Bonario by Volpone and Mosca in favour of Volpone; Corbaccio thinking that Volpone is dying is not concerned about this. This leaves the third man – Corvino, a penny-pinching merchant with a beautiful young wife, Celia, whom he guards closely; however despite him being such a jealous husband his greed lead him to proffer Celia to Volpone to take to his bed and to be a comfort to him as he lies dying. When Volpone attempts to force himself on Corvino’s young wife, he is interrupted by the appearance of Corbaccio’s son, Bonario. Celia and Bonario, but the three fortune hunters (scared of Volpone losing his wealth which they each think will soon be theirs take out counter-charges against the young couple of adultery and fornication. Volpone loves the chaos that he has caused and so decides to make more sport for himself by staging his own death and leaving everything to Mosca, just so that he is able to witness the mayhem that will occur. Mosca, however, as he prepares for a large and expensive ‘funeral’ for his ‘late’ employer, has less and less to do with Volpone. Mosca also is suddenly elevated from his lowly position to a man of wealth, an eligible bachelor As Volpone watches the changes in his old servant, he decides to ‘come clean’ and expose his own guilt as well as that of everyone else in the matter servant. When the truth is learned, the judges take away all of Volpone’s wealth and give it to charity; the lawyer Voltore is barred from court, all of Corbaccio’s fortune is given to his son, Corvino is paraded through Venice and derided, Celia is returned to her family taking with her three times the amount of dowry that she took to her husband and Mosca is sentenced to a life in the galleys for masquerading as a man of substance.

The Importance Of Stakeholder Identification For Project...

Introduction For a project, stakeholder identification forms the initial step in the stakeholder management process. After the project manager confidently identifies the stakeholders, the remaining steps in the process can proceed. However, without accurate identification of the members in the set of stakeholders, the project is at risk of unexpected impacts that could delay or cancel the project or incur unforeseen financial costs to the bottom line. This paper examines the importance of stakeholder identification for project management, outlines various strategies for identifying stakeholders, discusses the implications and identification of project management bias in analyzing stakeholders, and discusses the addition of stakeholder management as a new body of knowledge within A Guide to the Project Management Body of Knowledge (PMBOK Guide) by the Project Management Institute (PMI). 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