...Letter from Prison Esta lectura relata el caso de Stephan Richards y su travesia por Corporate Associates (CA) finalizando en 7 anos de carcel. Veo como el problema principal que los directores de CA estaban enfocados en el fin sin importarles los medios. En otras palabras, los directivos manipulaban los datos financieros (fechas de los cierre de contratos en cada cuatrimestre) para cumplir sus metas de ventas internas previamente establecidas y por ende llegar al EPS prognosticado por los analistas. El GAAP establecia que los ingresos por licencias de software fueran reconocidos una vez se firmaba el contrato, el software estuviera entregado y el pago razonablemente asegurados. Según GAAP, CA debio registrar el valor presente del contrato en el cuatrimestre que se cumpliera con estas 3 condiciones. A continuación un dateline de los acontecimientos del caso: Julio 2000 – CA anuncia que sus resultados financieros para 1er trimestre 2011 seria menos de lo prognosticados por Wall Street. CA justifico este resultado por la tendencia de muchos clientes esperar ultimo minuto para firmar esperando beneficiarse de mayor oferta, plazos mas largos de pago, servicios gratuitos, etc. y resulto que no firmaron a tiempo. April 2001 – NY times cuestiona las practicas de contabilidad excesivamente agresivas para usados por CA para impulsar ganacias. CA se defiende. April 30, 2001, KMPG, los auditores de CA, defiende las practicas de contabilidad de CA. Empieza una investigación...
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...FOODCORP REFLECTION PAPER 1. INTRODUCTION In FoodCorp simulation, held on 22 nd of November, my position was VP Marketing Services and I worked under the head of SVP Service Group. Service group consisted of 4 people including one senior vice president and three vice presidents. As VP of Marketing Services, I was responsible for marketing communications in general. I also mention about organizational structure of FoodCorp to establish a basis for my latter discussions. FoodCorp has a matrix structure and also has a number of committees like executive committee, acquisition committee, new business committee and distribution committee. In this paper, I will give brief information about our simulation process and then provide my reflections about some specific moments. 2. SIMULATION PROCESS President’s Decision about Groups: At the beginning of the simulation, our president enabled us to introduce ourselves and give information about our roles. Then each group continued with small meetings with their own groups. After group meetings, we would continue with committee meetings according to the original agenda. However, we were divided into two groups: Those who have operational roles and those who have not and our president decided each group to held meetings according to that division. In the operational group there were 9 people while non-operational group was consisting of 3 people. Service Group Meeting: I think that we held a successful and effective meeting in...
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...serious were Stephen Richards’ actions? Why? Stephen Richards’s actions were extremely serious; manipulating Computer Associates’ quarter end cutoff to align CA’s reported financial results with market expectations by violating the generally accepted accounting principles and their financial reporting responsibilities. According to the U.S. Securities and Exchange Commission, Richards with other CA executives extended CA’s fiscal quarter, “ instructed and allowed subordinates to negotiate and obtain contracts after quarter end while knowing, or recklessly disregarding the fact that, CA would improperly recognize the revenue from those contracts, and failed to alert CA’s Finance or Sales Accounting Department that CA salespersons that reported to Richards were obtaining contracts with backdated signatures dates after quarter end.” (Release) Richard in his letter writes that his self and the CEO exerted significant pressures on their team to meet the goals that they had set for themselves, also Richard mentions that performance was measured by internal goals in accordance with the expectation set by outside parties, analyst community, specifically to meet Wall Street quarterly per-share earnings estimates, “a key to keeping a company’s stock price rising.” (Wharton) Richards with the CEO allegedly met routinely and conferred with each other and with Zar (CFO) during the week following the end of fiscal periods, including during the “flash period”, the three business days after the...
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...Real-time Business Intelligence: Best Practices at Continental Airlines1 Written by Hugh J. Watson (University of Georgia), Barbara H. Wixom (University of Virginia), Jeffrey A. Hoffer (University of Dayton), Ron Anderson-Lehman (Continental Airlines), and Anne Marie Reynolds(Continental Airlines) Data management for decision support has moved through three generations, with the latest being real-time data warehousing. This latest generation is significant because of its potential for affecting tactical decision making and business processes. Continental Airlines is a leader in real-time business intelligence and much can be learned from how they have implemented it. The movement to real-time is the latest development in business intelligence (BI) and data warehousing. Real-time data warehousing provides the data that is required to implement realtime BI. By moving to real-time, firms can use BI to affect current decision making and business processes. This capability is especially important for customer-facing applications, such as those found in call centers and check-in processes, and helps firms become more customer-centric. Terms such as the “real-time enterprise” and the “zero latency organization” are often used to describe firms that use real-time BI. The purpose of real-time BI is to increase revenues and decrease costs. Companies that successfully implement real-time BI can dramatically improve their profitability. For example, Continental Airlines,...
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...A letter from prison Introduction Richard is the executive of Computer Associates. His company sells software products which usually have licence last for a period of three to ten years. The company has a “sales-driven-culture” which is “the more you sell, the more commissions you will get”. Richard is responsible for keep an eye on things like when the contracts are signed and when those payments are assured. It seems that he failed on his job because he was put in jail on April 24, 2006. The accountant department had recorded the sales in the current quarter while these sales should be recorded in the next quarter, which took place at the fourth quarter of 1998 and the second quarter of 2001. According the evidence and the proclamation of prosecutors, the action account department has taken was not following the GAAP. However, to the word of Richard himself, this way of accounting was not a really big deal like the WorldCom bankrupt or Enron bankrupt. And he is also very confident to continue developing his career in the future after he is released from the jail. 1. Sumarize the lessons learned by you from reading this article. The way that Computer Association records its sales has pointed out several accounting principles and concepts. According to the article, the account department recognized revenue while the contract was signed. It follows the accrual concept that revenue is recognized not only when cash transactions occur. Since the contracts were signed,...
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...Questions: ETHICAL ISSUES Q1. How serious were Stephen Richards’ actions? If Computer Associates achieved the same financial results within “allowed accounting flexibility”, will this change your answer? Q2. Richards describes how difficult it is to operate in the “gray areas of accounting” and wanted more guidance from senior management. Do you agree or disagree with him? If you were placed in the same position as Richards, how would you handle the situation? What are the options that you think you would face in deciding what to do? Q3. Step back and consider management’s incentives and choices. What are Computer Associate’s motivations to manage earnings and the financial value represented by the statement of financial position? What type of corporate governance structures in firms have been identified by the research as a flag, or indicator, that a firm is more likely to manage/manipulate financial accounting outcomes? ACCOUNTING ISSUES Q4. Comment on the GAAP standard that allows software firms to recognize the entire value of the licensing contract as revenue in the quarter that the contract was affirmed. Do you think this accounting treatment contributed to the culture at Computer Associates? Why or why not? Q5. Exhibit 4 provides an overview of the inflated recorded revenue and EPS. Is it important for Computer Associates to meet analyst estimates? Why or why not? Q6. Does accounting management/manipulation have an impact on stock prices? (Hint:...
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...Summary of “Letter from a Birmingham Jail” In the featured article, “Letter from a Birmingham Jail”, an imprisoned Dr. Martin Luther King, on the date of April 16, 1963, composes a response to his fellow clergymen addressing their criticism of his activities and beliefs. He begins the note with an explanation for his presence in Birmingham. An associate had invited him with the request of initiating an immediate action, nonviolent plan, to fight the segregation, racial issues, and injustice found in Birmingham. The author suggests there are 4 steps to building a nonviolent campaign: verifying the existence of injustice by compiling evidence, negotiating with the power, self-purification to prepare for the event, and immediate measures to deal...
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...At the point when Rev Dr. Martin Luther King, Jr., made his name in the United States of America, he was arrested and detained inside a prison in Birmingham, AL, for reason obscure. While he was holding up in prison, eight caucasian priests of Alabama issued a letter to African-Americans and asked them to quit dissenting in the boulevards. King was exasperated by this letter, and reacted by composing "A Letter From a Birmingham Jail" asserting that African-Americans will never get the rights they merit in the event that they quit dissenting. King’s first rhetorical strategy he used was the use of loaded language. King used loaded language to assist in the understanding of the horrors that were being wreaked upon African-Americans everyday. One example of this is when King said, “ But when you have seen vicious mobs lynch your mothers and fathers at will and drown your sisters and brothers at whim”. This statement told about...
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...From 1963 to modern day, 2015, Martin Luther King serves as a monumental figure of justice, as he fought for the equality of men that defines our society today. His courageous actions sent him willingly to jail yet did not stop his ambition for equality. In his “Letter from Birmingham Jail”, King uses rhetorical devices of ethos, logos, and pathos to persuade the Clergymen and the American public that the severity of unjust treatment of blacks has reached its breaking point, and justice must come now. As King write his piece from prison, he must establish himself credibility, proving himself worthy of the clergymen’s time and ears. Throughout the piece, King uses ethos to give himself credit on the topic of racial injustice. He begins...
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...Over the course of “Letter from Birmingham Jail” (1963), the author, Martin Luther King Jr., makes extended allusions to multiple philosophers, among them Aquinas and Socrates. His comparison would seem to indicate that he shares an affinity with them. However, the clarity with which he makes his arguments and the dedication to a single premise strikes most strongly of Kant. Just as Kant’s magnum opus, Critique of Pure Reason, attempted to completely upend a previously accepted mode of thought, so also was King’s work devoted to a single objective: the protection of civil disobedience as a form of protest such that the Civil Rights Movement could continue in uncompromised form. Despite this singularity of purpose, the complexity of the situation meant that a more nuanced response to the statement A Call for Unity as published by eight Alabama Clergymen was necessary. In this way, King’s letter in fact served a fourfold purpose: to establish himself as a legitimate authority in the eyes of his audience, to show the trials of the black in America, to justify his cause, and to argue the necessity of immediate action. In Martin Luther King Jr.’s letter, written to the Clergymen from Birmingham Prison, he uses the rhetorical appeal of ethos to establish his credibility on the subject of racial discrimination and injustice. He starts off the letter with “My Dear Fellow Clergymen”. By him saying this, he is putting himself on the same “level” as the clergymen, sending the message that...
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...From 1963 to modern day, 2015, Martin Luther King serves as a monumental figure of justice, as he fought for the equality of men that defines our society today. His courageous actions sent him willingly to jail yet did not stop his ambition for equality. In his “Letter from Birmingham Jail”, King uses rhetorical devices of ethos, logos, and pathos to persuade the Clergymen and the American public that the severity of unjust treatment of blacks has reached its breaking point, and justice must come now. As King writes his piece from prison, he must establish himself credibility, proving himself worthy of the clergymen’s time and ears. Throughout the piece, King uses ethos to give himself credit on the topic of racial injustice. He begins...
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...King, Jr. (Dr. MLK) and Mohandas K. Gandhi (Gandhi) harnessed the idea and brought it to its prominence. Civil disobedience in its purest form is a particularly strong concept because it requires a self-purification process. This process enlightens civil resisters to the reality of longsuffering for a cause without any type of retaliation. Also, there are arguments against civil disobedience. One such argument is “wait” because change will come. Another is that civil disobedience precipitates violence. These arguments are extremely weak. Because of these weak arguments along with the strong concept of self-purification, I am a proponent of civil disobedience. Dr. MLK was a firm believer in the self-purification process. In Letter from Birmingham Jail, he speaks of undertaking a process of self-purification. “We began a series of workshops on nonviolence and we repeatedly asked ourselves: ‘Are you able to accept blows without retaliation?’ ‘Are you able to endure the ordeal of jail (King 158)?’” Dr. MLK knew that in order to appeal to the public, they must endure the punishment without retaliation. This is explained when he says, “Laying out our case before the conscience of the local and national community (King 158).” Dr. MLK had a grasp on the notion that if his people were to become violent, they would not appeal to anyone’s conscience. And, their credibility would be lost. Gandhi is another civil resister who knew and believed in the importance of a self-purification...
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...Practicing civil disobedience addressing his demands for racial equality landed Martin Luther King, Jr. a spot in Birmingham Jail. The incarceration resulted in a large amount of free time which he used to complete a lengthy letter addressing the clergymen who criticized his actions, calling them untimely and unwise. These criticisms did not sit well with King and therefore, he formulated “Letter From a Birmingham Jail.” Although long winded, Martin Luther King, Jr. uses repetition, in “Letter From Birmingham Jail” to his benefit, in addition with ethos and pathos to sway his audience and develop his reasons for his civil disobedience. Ending at an astounding eleven pages, Martin Luther King, Jr. covers a great amount of information throughout “Letter From Birmingham Jail”. The length of this letter most likely was due to the fact he was locked in a cell with nothing better to occupy himself with, King admitted himself, in the last page of the letter, “Never before have I written so long a letter” followed by, “...what else can one do when he is alone in a narrow jail cell, other than write long letters, think long thoughts and pray long prayers?” (11). King’s letter may have been shorter if he was not confined in a small, bland, lifeless, prison cell, however those were his circumstances and he made the...
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...Letter From Birmingham In April of 1963, Martin Luther King, Jr., was jailed in Birmingham, Alabama for his efforts in the civil rights movement. One day after King's arrest, a full-page advertisement taken out by a group of local, white, moderate, clergymen appeared in The Birmingham News. They attacked the demonstrations as "unwise and untimely" and concluded, "We do not believe that these days of new hope are days when extreme measures are justified in Birmingham. From his prison cell, King replied not only to the ministers' letter but also to an educated, white, middle-class audience, by writing his response in the margins of the newspaper and on toilet paper . "I have yet to engage in a direct action campaign that was well timed in the view of those who have not suffered from the disease of segregation," King, wrote in what was later published as the essay, Letter from Birmingham Jail. The 6500 word letter went on to explain and make clear to the clergy and to the world why the struggle against racism must not be deferred. King's main claim in this letter is that no matter what the circumstances are it is far beyond time for the black community to stand up and fight for what is rightfully theirs, the same rights and freedoms accorded to the white community. King effectively accomplishes this task through the structure of the essay and in his use of pathos, ethos, and logos to defend his arguments. King's structure of the essay is purposeful in its attempt to sway...
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... March 17th, 2014 Dr. Martin Luther King Jr’s “Letter from Birmingham Jail”. Question 6 on page 177 Have you ever thought about integrity? We all have at some point in our lives. The Miriam-Webster Dictionary defines integrity as “the quality of being honest or fair and the state of being complete or whole.” Dr. Martin Luther King Jr. and Stephen L. Carter spoke about this and defined it in their own ways. Stephen L. Carter wrote in “The Rules about the Rules” that “integrity requires 3 steps: (1) discerning what is right and what is wrong; (2) acting on what you have discerned, even at personal cost; and (3) saying openly that you are acting on your understanding of right from wrong.” During a major protest of unfair business practices in Birmingham, Alabama, Dr. King was arrested and put into jail for his actions. In his “Letter from Birmingham Jail,” he gave evidence of Stephen L. Carter’s definition of integrity. “Discerning what is right and what is wrong.” In 1954, the Supreme Court came to the decision to outlaw segregation in public schools. Even though this was Federal Law, the community still chose to obey the city ordinances of segregation. Dr. King stated that for the African-American people there was “grossly unjust treatment in the courts, and there were more unsolved bombings of Negro homes and churches in Birmingham than any other city in the nation.” Despite strong efforts made from the leaders in the African-American community, the city...
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