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2013년 11월 30일 토요일

About 'fasb accounting'|Lease Accounting: FASB/IASB Project Update - Monitordaily







About 'fasb accounting'|Lease Accounting: FASB/IASB Project Update - Monitordaily








Should               the               government               be               more               involved               in               controlling               irresponsible               behavior               of               companies?

"The               mission               of               the               U.S.

Securities               and               Exchange               Commission               is               to               protect               investors,               maintain               fair,               orderly,               and               efficient               markets,               and               facilitate               capital               formation."               In               1933               Congress               passed               the               securities               act               of               1933.

In               1934               the               Securities               Exchange               Act               was               formed.

Together               these               created               the               SEC.

There               was               a               need               for               intervention               because               after               the               Great               Depression               investors               needed               their               confidence               in               the               market               restored.

The               SEC               protects               the               investor               by               providing               the               public               with               information               and               rules               of               how               companies               should               behave               (SEC.gov,               2009).

There               are               other               government               agencies,               such               as               the               FASB,               which               established               the               generally               accepted               accounting               principles               (GAAP).

GAAP               is               a               set               of               rules               that               companies               need               to               follow               to               report               their               financials.

Managers               who               do               not               follow               GAAP               guidelines               are               subject               to               fines               and               possibly               imprisonment               (Investopedia,               2009).

It               was               clear               after               the               situations               that               happened               at               Enron,               WorldCom               and               Arthur               Anderson               that               the               government               needed               to               get               involved               again.

This               led               to               the               Sarbanes-Oxley               Act               (SOX)               of               2002               (Jones,               2007).

The               main               goal               of               the               Sarbanes­               Oxley               Act               was               to               correct               the               financial               standards               of               corporations.

Companies               need               to               submit               their               annual               reports               to               the               SEC.

They               need               to               explain               the               internal               accounting               controls.

CEO's               and               CFO's               need               to               certify               in               writing               that               the               company's               financial               statements               comply               with               the               law               and               accurately               represent               the               company's               financial               situation.

If               the               officers               of               the               companies               violate               the               Sarbanes               Oxley               Act               they               can               be               faced               with               substantial               fines               and               imprisonment.

The               act               also               protects               whistle               blowers,               and               prevents               the               individuals               who               would               face               fraud               charges               from               filing               bankruptcy               in               order               to               hide               their               assets               (Atkins,               2002).
               Now               we               need               to               answer               the               question               as               to               whether               or               not               the               government               should               be               more               involved               in               controlling               irresponsible               behavior.

In               my               opinion               I               feel               that               this               is               not               necessary.

The               added               costs               that               companies               have               had               to               endure               to               become               compliant               with               SOX               such               as               legal               fees               has               discouraged               companies               from               going               public.

Also               some               companies               are               delisting               their               shares.

Some               companies               have               had               to               hire               new               employees               because               SOX               requires               a               segregation               of               duties               (Daks,               2006).

The               policies               that               the               government               has               in               place               are               effective               as               long               as               companies               follow               the               rules.

There               are               a               few               companies               that               are               going               to               violate               the               rules,               but               most               of               them               are               going               to               abide               by               the               laws               that               are               currently               in               place.
               References:
               Atkins,               P.

S.

(n.d.).

U.S.

Securities               and               Exchange               Commission               [Speech               by               SEC               Commissioner:               The               Sarbanes-Oxley               Act               of               2002:               Goals,               Content,               and               Status               of               Implementation].

Retrieved               April               18,               2009,               from               http://www.sec.gov/news/speech/spch032503psa.htm
Daks,               M.

C.

(2006,               August               3).

Companies               'Go               Dark'               to               Avoid               SOX               Compliance.New               Jersey               Law               Journal.

Retrieved               April               18,               2009,               from               Law.com               database:               http://www.law.com/jsp/ihc/               PubArticleIHC.jsp?id=1154509535896               Investopedia               [Financial               Accounting               Standards               Board               -               FASB].

(n.d.).

Retrieved               April               18,               2009,               from               http://www.investopedia.com/terms/f/fasb.asp               Jones,               C.

(2007)               Investments               (10th               ed)               Hoboken,               N.

J.

John               Wiley               &               Sons               Inc.U.S.

Securities               and               Exchange               Commission               [The               Investor's               Advocate:               How               the               SEC               Protects               Investors,               Maintains               Market               Integrity,               and               Facilitates               Capital               Formation].

(n.d.).

Retrieved               April               18,               2009,               from               http://www.sec.gov/about/whatwedo.shtml               





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