...TEAM B TEAM B ------------------------------------------------- Assessing Materiality and Risk Simulation University of Phoenix ACC/491 Dwayne Thompson March 10, 2013 ------------------------------------------------- Assessing Materiality and Risk Simulation University of Phoenix ACC/491 Dwayne Thompson March 10, 2013 The objective of the audit of financial statements is to enable the auditor to express an opinion if the financial statements are prepared in accordance with an identified financial reporting framework. The reason that materiality is allocated to those accounts sampled because materiality represents the magnitude of an omission or misstatement of an item in a financial report. The three function of the audit risk are inherent risk (IR), control risk (CR), and detection risk (DR). Every level of audit risk has an opposite connection that exists between assessed levels of controls, inherent risk, and level of detection risk Why do certain accounts have to be audited 100%? Accounts need to be audited 100% so the users of the financial statements can rely on the information and be able to make decisions for investment purposes. It also helps management make sure the company is profitable as well as following rules and regulations of the accounting standards and policies. Auditing accounts are done to protect the investors, shareholders, banks, and to give assurance that the information...
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...| Entrepreneurship | SBMG 6006 | | Discussion on an importance of risk taking and innovation in entrepreneurship. | | 7/14/2011 | | Executive summary: - This academic work explores that how risk taking and innovation play an important role in entrepreneurship process. This report provides critical view about these given topics by examined different models, theories and opinions of different authors etc. This report also puts light on differences between term entrepreneurship and entrepreneur. Methodology: - Introduction: - Entrepreneurship is a dynamic process of vision, change and innovation. It requires an application of energy and passion toward the creation and implementation of new ideas and creative solutions. Entrepreneurship has been categorized in different skills such as inner control, planning and goal setting, risk taking, innovation, reality perception, use of feedback, decision making and human relation etc. Miller (1983) defines entrepreneurship as a multidimensional concept encompassing a company’s action relating to innovation and risk taking and proactive measures.Innovation and risk-taking has an important place in entrepreneurship. Schumpeter (1994) described role of entrepreneurship as tendency of company to engage in and support new ideas, novelty, and experimentation that may result in new products, services. Risk taking describes the nature of entrepreneur. A.H. Cole has explained entrepreneurship as, “the...
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...THE COST OF CAPITAL, CORPORATION FINANCE AND THE OF INVESTMIENT In the business world we make investment for two main reasons or either of them that can be for the maximization of our profite from a business or it can be for the maximaization of the market value of the assets. Businesses generally aquire the assets if the perceives that the particular asset can help in increasing the profit of the organisation. According to the theory the acquisition of the asset can help to increase the profit only if the returns arising due to that asset are more than the interest costs arising due to that asset. On the individual level when we are cosidering the purchase of any asset we should also consider the risk factor associated with that asset. Profit maximization and value maximization they both have more or less same meanings and implications. But if the case is of uncertainity then the profit maximization has no meanings, it remains meaningless for the investors. When the situation is uncertain then in that case the market value maximization becomes the basis for the theory of investment, if this notion is kept in mind then every time when we are going to make a decision to invest or not we should simply keep one thing in our mind that can be the basis of the decision, that is if we aquire the particular asset will it help to increase the value of the firm’s share? If in response of this question we comes on this point that yes it will result in increase in the value of the firm’s...
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...retailers. However, pursuing this option would drain Rose’s resources and prevent them from launching their own branded goods. Additionally private-labels would make Rose into a manufacturer-only role and limit its long-term prospects, but having its own brand is very costly to promote and comes with many short-term risks. Possible Solutions: 1. Proceed with Rose Partyware branded party supplies. * Retain loyalty of small independent retailers (35% of sales) * Brand advantage in party supplies versus other generic suppliers * Positive long-term returns * Control over pricing, branding, and distribution of goods * Short-term technological advantage 2. Pursue manufacturing private-label goods for retailers. * Retain largest Rose customer (20% of sales) * Supplier of choice in private-label manufacturing * Lowest short-term risk * Cheapest option in terms of change to company structure & spending The Decision: If I were in Tom Roses’ position I would choose to proceed with Rose Partyware branded party supplies and persuade Party! to hold off its test launch. While this decision would expose Rose Partyware to the short-term risk of promoting their new brand, the potential returns as well as the prospects for long-term growth results in a net advantage for Rose Partyware. The threat of operating as an easy-to-replace private-label supplier is too risky Rose Partyware despite the short-term payoff....
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...in order to improve the company. What benefits do you think the employees derive from this arrangement? There are many benefits that the employees can derive from this arrangement. If the business can decide to expand, which creates more opportunities for work and even a promotion if need to. Another example is that if the business keeps up with the latest technology, the employee will work less since technology makes life easier. As machinery innovates as the year passes. With a HR, the employees will have several more benefits and will be protective in case of an accident where to occur at work. What do you think are the risks involved (to HR and the organization as a whole) if HR does not make this a priority and instead remains a purely task-oriented department mostly administrative in nature? In a business everything is a risk there or not there will be a HR or not. However, a HR is a useful organization that can help the business if handle properly with the right decision obviously. By finding the “middle ground” as we say, in order to keep the employees satisfied and at the same time keeps the production going the outcome should be a total...
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...* Posted on: Wednesday, March 13, 2013 Apache Questions 1. What risks does Apache face? Do they differ by country of property type? Do the risks of the major integrated oil companies differ from those faced by Apache or other independents? How does Apache’s operating strategy affect its risk exposures? 2. What is Apache doing now to manage risk? What risks are they attempting to hedge? What are its competitors doing? 3. What are the potential hazards Apache faces if it manages risk? 4. As a member of Apache’s board, how would you recommend they proceed? If they decide to manage risk, what steps should they take? Which risks should they shed? Which risks should they retain/keep? Should they manage some types of risks but not others? Some types of investment decisions but not others? How should FAS 133 affect their strategy? Case Study Questions Each team is required to address the four questions posted above. You should view your case report as a report to senior management or the board of directors. It is to provide the decision makers with all relevant information of a particular case and your policy recommendation, using the assigned questions as a guide. There is no formal size limit for a case report, but you should keep in mind that conciseness and clarity make reports more convincing and will be rewarded accordingly. In particular, a summary of the facts from the case should not include the facts that are not relevant to your analysis...
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...Decision and Risk Analysis for the evaluation of Strategic Options The process of evaluating and selecting options is complicated involving high stakes, a mount of diverse and dispersed data, multiple and conflicting objectives, uncertainty regarding the future and different stakeholders have different views and considerations. Strategy evaluation is a complex social-technical process=>decision and risk analysis is a powerful way to approach it. Understanding the decision situation Tool: scenarios planning, SWOT/TOWS analysis. The identification and develop fundamental objectives is typically informed by setting “strategic direction and goals “ element of the strategic development process. tool: use value tree (top down approach or bottom up approach: start from the attributes and them identify the objectives) associated attribute should be specified, three types of attributes: Quantitative direct ,Quantitative indirect, Qualitative attributes. Each attribute should follow five properties: Comprehensive: the upper and lower limits of attributes are well specified. Otherwise it will distort out trade-off When building a value tree, fundamental objectives must follow the following properties: Preferential independence: Sometimes, it’s difficult to avoid preferential independence. A practical way of dealing with preferential dependence is to redefine the objectives, usually aggregating two dependent objectives into single one. Notice also that statistical...
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...OVERVIEW……………………………………………2 - History of Japanese Economy - Japanese Financial & Banking System - Mitsubishi UFJ Financial Group BANK OF TOKYO MITSUBISHI UFJ………………16 - Structure - Rating - Capital - Competition - Services BANK MANAGEMENT ANALYSIS…………...……29 - Asset Management - Liability Management - Risk Management - Other Developments (Social Responsibilities) REPORTS ANALYSIS………………………………..35 - Financial Sheets - Financial Ratios FORECASTING……………………………………….38 - Forecasted Financial Sheets CONCLUSION………………………………………...40 I. OVERVIEW A) History of Japanese Economy The Japanese economy is the 3rd largest economy in the world, coming right behind the American economy and the economy of China. It’s one of the most studied economies among all due to its rapid growth in different eras. Its economy first interacted with Europe in the 16th century, and the Europeans were admirers of the country as it was one of the richest in metals and became a major exporter of copper and silver. In 1603, which is the beginning of the Edo period, the interaction between the Japanese and Europeans was extremely intense, and that, however, exposed Japan to Christianization waves, which lead Japan to enter a period of isolation in order to avoid such religious waves. Significant expansion of domestic industries increased during this phase. The construction trade grew along with banking dealing activities. The Edo period ended in 1868, and by that time Japan...
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...ASSESSMENT ITEM 1—WRITTEN ASSIGNMENT Due date: Weighting: Length: Week 6 40% Less than 5MB ASSESSMENT 1 OBJECTIVES This assessment item related to course learning outcomes 1, 2 and 6. QUESTION 1 (5 MARKS) List and describe the major components of BI. What are the major similarities and differences between DSS and BI? QUESTION 2 (20 MARKS) XYZ is a manufacturing company specialising in a variety of dairy products. The company is planning to launch a new product in the Australian market. The product development group claims that the anticipated net present value for the new product is over $1,000,000 (one million dollars) and they have recommended the project to proceed. Your task is to check the group‟s claim to determine if it is reasonable. In doing so, you are required to develop a decision support system using Visual DSS. This decision support system will be used to assist the management of the company to make an informed decision about manufacturing of the new product. Table 1 summarises the related information. Cost of production: $7.25 per unit Annual overhead cost: $1,000,000 Initial investment needed: $5,000,000 Estimated selling price: $15.75 per unit Market at time of introduction: 900,000 units per year Market growth: 9.5% per year Market share: 36% Assumed economically useful lifetime: 5 years, commencing in 2014 Discount rate used to analyse new product proposals is 12% Table 1: Production details 1 Your task details: 1. Develop...
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...Decision-Making Case Study HCS/514 Ed Paluch Decision-Making Case Study It has been estimated that approximately 75% of the average managers time is spent on the decision-making process (Free Case Study on Decision Making, 2011). A critical component in managing an organization, its staff and resources is successful decision-making. The quality and efficiency of those decisions will determine how well the manager is doing. Managers have plenty of responsibility because they are the ones that have to make the right decision when solving issues. Today, decision-making regarding health services for consumers and patients are becoming guided by evidence of need, effectiveness, and ways to use resources optimally. This is becoming a growing model among health care organizations and its managers. However, there are barriers for managers in using evidence decision-making. Time is a big barrier, there are deadlines that managers usually have to work with that is very time consuming. For instance, plenty of time is required to research, accessing relevant data, reliance on outside consultants and subordinates in acquiring quality information, politics, and lack of resources. The use of an sufficient decision-making tool that assists managers in efficiently making strategic, evidence based decision-making as well as improving the performance of their organizations is the Informed Decisions Toolbox as outlined by Thomas Rundall. The Informed Decisions Toolbox is...
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...Current Marketing Practices in Consumer Durables in Rural India Contents Introduction ........................................................................................................... 3 Indian Rural Market: ........................................................................................... 3 Recent shift in attention from urban to rural market:......................................... 3 Special Features of rural markets: ...................................................................... 4 Methodology ......................................................................................................... 6 Questionnaire ........................................................................................................ 7 Responses .............................................................................................................. 8 Respondent 1...................................................................................................... 8 Respondent 2...................................................................................................... 9 Respondent 3.................................................................................................... 11 Learnings from the Project................................................................................... 14 Awareness ........................................................................................................ 14 Acceptability .......................
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...Compiled by Allan Simiyu for BBM 312 Students only 1 CHAPTER ONE INTRODUCTION 1.1 Introduction Whether a business concern is big or small, it needs finance to fulfill its business activities. Finance may be defined as the art and science of managing money. According to Oxford dictionary, the word ‗finance‘ connotes ‗management of money‘. Webster‘s Ninth New Collegiate Dictionary defines finance as ―the Science on study of the management of funds‘ and the management of funds as the system that includes the circulation of money, the granting of credit, the making of investments, and the provision of banking facilities. Therefore, Finance is defined as the procurement of funds and their effective utilization in business concerns. The concept of finance includes capital, funds, money, and amount. But each word has a unique meaning. Studying and understanding the concept of finance become has an important part of the business concern. 1.2 Corporate Finance Financial Management or corporate finance, deals with procurement of funds and their effective utilization in the business entities. Financial management is the broadest of the three areas of finance and is important in all types of businesses including banks, financial institutions, industrial concerns, and retail firms, governmental institutions such as schools, hospitals and even local governmental departments. Corporate finance is concerned with budgeting, financial forecasting, cash management, credit administration,...
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...Decision Making Process Paper Tiffany Camphouse November 21, 2011 MGT 230 A time in my life that I had to make a personal decision was when I decided to move. I had a pretty good job, but the rest of my family was moving away, and I did not want to be the only one left there. I had been working at my job for just over a year, and had just recently found out that I was pregnant for the first time. My boyfriend and I had our own place, but neither one of us had a vehicle. With my family planning to move out of state I was forced to make a decision. I had to decide if I was going to move closer to my job, or quit my job and move closer to my boyfriend’s parents, or move back to the place that I was born and raised for most of my life. The first thing that I did when I found out that I was going to have to move was talk to my boyfriend. He said that he didn’t know what we should do, but he didn’t want to move to the town that was close to my job. He felt that the town was too small, and the fact that we did not know anyone there was the other reason. The next thing that we did was talk about who’s parents we were going to move with. I wanted to move with my parents, because I was seven months pregnant and wanted to be with my mom to have the baby. He was torn because he had never been more than a few hours away from his mom, but he thought it would be cool to see some place new. After about three weeks of discussing our options we came to an agreement on moving...
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...Selecting the optimum Health Care Coverage Plan <<your name>> <<instructor’s name>> <<course title>> <<date>> Assume you are the HR Director for a midsized company and must make a decision about the company’s employee benefits package. You have not been in this position before and must maintain the current benefits budget; there may be no increases or changes to the package that will result in additional spending. 1. Describe the selection process you would use to make the most cost-effective and employee-friendly decision. Answer – Choosing the right type of benefits package is a very critical component of being attractive employer, helping attract and retain satisfied employees, by ensuring that majority of employee needs are taken care of. Given the huge number of options that are available in the market, with many more coming up every year, it becomes very tricky to determine what benefits package would be the most beneficial to the employee. Given the constraints on budgets, there must be multiple trade offs made between the extent and variety of benefits provided, and therefore the employer has to determine which package would cover the needs of majority of its employees. In this scenario, given that the available budget is fixed and the benefit plan for the next year has to at least as good as or even better than the previous year, the HR director has to think creatively to come up with a package that best aligns...
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...Portfolio Analytics 1. Introduction: To analyze our portfolio and determine its exposure to risk factors, we assumed that: Rit+1=a+bi,1F1t+bi,2F2t+…+bi,nFnt+eit+1 First, we calculated z-score for logarithm of b_p and logarithm of cap to determine sensitivities for stock-specific factors. After we got all 13 sensitivities, we did a weighted regression of the 13 sensitivities against the 1000 stock’s forward return in 60 periods, respectively. For each period, we got 13 coefficients, which were the risk premiums for each risk factor. Finally, we regressed the risk premium from our regression against the portfolio return, bench return and active return. Doing so, we get these returns’ sensitivities against risk factors and were able to determine our portfolio’s exposure to various risk factors. 2. Procedures and Analysis 2.1. Working Procedure Nearly all of the calculations in part II were done by VBA Macros. In the Project part2.xlsm, there were 6 worksheets. The Data recorded all the cross-sectional data for 60 periods, having 1000 stocks in each period. StockPriceData recorded the data for stocks in our portfolio. To run the regression, we assumed that for a particular stock, the forward return in a particular period was, rt+1=bisec10λsec10+…+bisec55λsec55+bibetaλbeta+bilnbpλlnbp+bilncpλlncp+e . The equation has no intercept, the risk premium for sector factor has already included the zero beta rate. To prevent stocks with smaller market capitalization...
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