From the Paper
"Introduction
Companies which are busy making sales often assume that they are also making a profit. Yet this is not always the case, particularly with new businesses whose owners are technically competent and perhaps even excellent sales people but who are not familiar with the basic accounting methods used to determine whether a profit is being generated by the organization. If a company's cost structure is too high, the organization will be unlikely to generate a profit because any increase in volume also generates a high increase in costs.

Understanding the relationship among costs, volume and profit is critical if a company is going to be able to generate strategies which can promote long-term growth. This research examines the cost-volume-profit analysis technique and considers how costs are allocated to the three.."

Abstract
The paper identifies and evaluates the key components of ethical accounting practices in the modern world, where there is a strong tendency to succumb to external influences in favor of personal gain. The paper explains that it is no longer that GAAP is the supreme code for accounting practices, rather there must be strong moral and ethical foundations that should be created at the academic level.

From the Paper
"In today's society, the accounting profession has experienced numerous challenges in an attempt to act in ethical ways with regards to accounting principles and business records. Generally Accepted Accounting Principles (GAAP) serve as a key reminder that businesses must act responsibly in their accounting activities at all stages, regardless of the potential that exists for personal gain and success. The following discussion will evaluate the importance of GAAP and accounting ethics in the context of modern organizations, where the temptation to act in a selfish manner is greater than ever. GAAP were designed to encourage a truthful representation of financial statements, based upon all business transactions conducted within specific periods (Shafer, Ketchand, & Morris, 2004)."

Tags:accounting, principles, ethics

Abstract
In the case of Frantek, Inc., a manufacturer of microcomputer parts, and Conte Technologies, a buy of same, the issue is how to measure and recognize valuation of assets and liabilities in order to provide a proper accounting at year's end for Frantek, relevant to an amended agreement between Frantek and Conte for parts supplied by Frantek to Conte. This paper first lays out the basic facts of this case and discusses general accounting principles which will impact the path that Frantek takes and then presents a general recommendation concerning how Frantek ought to recognize revenues, valuate inventories, and valuate and classify liabilities. Issues of the Case Frantek agreed to provide 100,000 boards over a 12-month period to Conte at a stipulated price per board, with provision for penalties for failure to perform.

From the Paper
In the case of Frantek, Inc., a manufacturer of microcomputer parts, and Conte Technologies, a buy of same, the issue is how to measure and recognize valuation of assets and liabilities in order to provide a proper accounting at year's end for Frantek, relevant to an amended agreement between Frantek and Conte for parts supplied by Frantek to Conte. After laying out the basic facts of the case and discussing general accounting principles which impact the path taken, a general recommendation will be made concerning how Frantek ought to recognize revenues, valuate inventories, and valuate and classify liabilities. Issues of the Case Frantek agreed to provide 100,000 boards over a 12-month period to Conte at a stipulated price per board, with provision for penalties for failure to perform.

Tags:accounting, valuation, recognition

Abstract
This paper looks at the new rules passed by the SEC, how and why they came about and discusses how they will affect the big accounting firms and business in general.

From the Paper
"On November 22, 2001, the Securities and Exchange Commission's new rules that will modernize its auditor independence standards for management consulting and other non-audit services offered by accounting firms, took effect. These new rules were put into effect because of the fast growing consulting services offered by the Big 5. Companies often hire Big 5 firms to audit and consult them at the same time. The SEC believes that this will lead auditors to give into their clients out of the fear that they will lose them for their consulting business. "

Tags:accounting, audit, SEC, security, and, exchange, firms, big, 5, statements, annual, commission, consulting, finance, violation

Abstract
This paper provides a basic introduction to ABC (Activity Based Costing) methods as a managerial accounting technique, a comparison to traditional based methods, benefits and disadvantages of ABC. The paper also includes an analysis of ABC methods as a TQM (Total Quality Management) component and provides a summary analysis of the system.

Table of Contents
Abstract
Introduction to Activity Based Accounting
Uses for ABC
Implementing ABC
Advantages of ABC Costing
Disadvantages of ABC Costing
ABC versus Traditional Accounting
The Concerns of Activity Based Management
Summary Analysis
References

From the Paper
"Activity-Based Costing (ABC) arose in the 1980s from the increasing lack of relevance of traditional cost accounting methods. The traditional cost accounting methods were designed around 1870 - 1920 and in those days industry was labor intensive, there was no automation, the product variety was small and the overhead costs in companies were generally very low compared to today. However, from the 1960s - particularly 1980s - this changed rapidly. Activity Based Costing is based on a simple principle: activities consume resources and customers consume activities. Associating the labor and overhead expenses of the business with the activities that consume those resources provides valuable facts. ABC defines categories of activity in overhead departments, which on the one hand are recognizable to overhead department managers but, on the other hand, are driven by factors (cost drivers) which are characteristic of products and other cost objects. This allows a much higher proportion of total company cost to be allocated to products according to causation. Ultimately, ABC provides accounting data points that can be used to improve decision-making and identify cost improvement opportunities. The basic building blocks for ABC are activity accounting spreadsheets for each element of a business. The workload of each activity is measured resulting in a cost per output. "

Tags:comparison, flaws, component, cost, data, labor, y

Abstract
This paper summarizes and reviews "The Goal" by Goldratt and Cox. The paper discusses "Theory of Constraints", a philosophy for improving production throughput presented in "The Goal", and looks at the concept of throughput accounting, a concept embraced by Goldratt and Cox in "The Goal".

From the Paper
"In The Goal, (Goldratt and Cox, 1986) Alex Rogo manages a troubled manufacturing plant. When his district manager informs Alex that profits must increase or the plant will be shut down, he turns to Jonah, a former professor. With Jonah's help, Alex turns the plant around while at the same time abandoning traditional management principles in favor of Jonah's Theory of Constraints and Throughput Accounting practices."

Tags:bottleneck, capacity, demand, equal, less, flow, maximize, profits, inventory, operational, expense

Abstract
Following the collapse of Enron and WorldCom and the flow on effects to Arthur Anderson, legislatures world wide are recognizing the need to reform the exposure of auditors and their firms to claims of negligence. This paper examines the merits of limiting the legal liability of auditors. The paper considers the measures recommended in Corporate Law Economic Reform Program (CLERP 9) and explores other practices adopted around the world.

From the Paper
"Many of the principles setting out the legal liability of auditors are found in the common law. In the case Re: London & General Bank Ltd (No. 2) , the court held that an auditor must exercise reasonable care and skill, the level of which was dependant on the circumstances. These findings were confirmed in Re: Kingston Cotton Mill Company (No. 2) , where Lopes stated that the auditor was "...a watch-dog, but not a bloodhound" and that he was only required to investigate matters which aroused suspicion. These standards of reasonable care and skill are not static, they change with time, per the findings of Pennycuick J in Re: Thomas Gerrard & Son Ltd."

Tags:clerp9, incorporation, proportionate

Abstract
This paper discusses how the accountant in a modern organization must be able to perform many more functions than in the past. Managerial accountants are important in assuring that the organization is on target for meeting strategic goals. It looks at how it is no longer enough to have a basic understanding of receivables, payables and cash flow and how accountants now play an active role in management and decision making. They are responsible for goal setting, forecasting and many other activities that were previously in the realm of management and must consider corporate culture and be able to adapt their techniques to meet specific company needs.

From the Paper
"Corporate culture and accounting used to be two terms that should never occur in the same sentence. Accounting was a separate entity from other systems in the organization. Now accounting is an integral part of every phase of the business including legal, political and social systems within an organization (Shraddha and Sidney, 1997). As the needs of an organization change, so do the accounting system change to meet these changing needs. A modern accountant must be more flexible in practice than in the past. Modern accounting practices must be able to adapt a trait that was not synonymous with accounting in the past. Accounting used to adhere to a rigid set of rules and procedures, but now they must remain flexible and willing to change on short notice. "

Tags:goal, setting, forecasting, management

Abstract
This paper considers the development of the accounting concept of profit. The paper considers the methods of measuring profit under various accounting systems and also analyses how profit is reported under GAAP.

Outline
Introduction
Profit Defined
Capital Maintenance
Determining Profit
Historical Cost Accounting
Current Cost Accounting
Reporting Profit
Conclusion

From the Paper
"The second measure of capital maintenance is maintenance of physical capital. This measure was born of the belief that there were inherent shortcomings in historical cost accounting and its objective of maintaining money capital. Instead, maintaining intact a monetary measure of wealth, this measure seeks to maintain the operating capacity of the firm, or the purchasing power of its wealth. Maintenance of physical capital is the objective in accounting systems using current costs (Henderson et al., p. 85-7)."

Tags:accounting, capital, cost, current, financial, maintenance, theory

Abstract
This paper provides some research into "Positive Accounting Theory" and how it impacts on the economy. The paper begins with an explanation of the theory itself and then offers some statistics and findings regarding the consequences of its use by management.

Contents:
Introduction
Explaining the Theory
Economic Consequences
The Development of Positive Accounting Theory
How Positive Accounting Theory Operates
Management Decisions
Watts and Zimmerman
Research and Findings
An Example of a PAT study
Conclusion

From the Paper
"Positive Accounting Theory and the doctrine of economic consequences helps us to understand why different firms choose different accounting policies, why some managers may object to changes in these policies and why investors may react to the potential impact of an accounting policy change. Accounting policy choices have economic consequences for the various constituencies of financial statement users and though complicating the setting of accounting standards, the source of the pressures driving the process can be explained by the development of a positive theory of the determination of accounting standards."

Tags:choice, policy, management, business