Premium Essay

Accounting Changes

In: Business and Management

Submitted By starbright52
Words 1261
Pages 6
| ACCOUNTING CHANGES | | | Sabrina Whitehead | Dr. M. Austin ZekenAccounting Undergraduate Capstone Acc 499 | 4/26/2012 |


Discuss the primary reason for the restatement and the impact to the financial results for the Company.

Dell computers has delivered technology solutions for more than twenty-six years and has transformed countries, communities and the private sector to help achieve their goals at work, home and school. Michael Dell created PCs Limited but later changed the name to Dell Computer Corporation in 1984, as a freshman attending the University of Texas. The young entrepreneur purchased computer parts from wholesale distributors, installed them in his version of the IBM, and then began selling the custom-built person computers from his dorm room. After one year of successful business Michael Dell left college and incorporated his business and the Dell Company went public, selling stock market shares for $8.50 per share.
After years of financial accomplishment in 2006 the Securities and Exchange Commission (SEC) made inquiries of Dell internal accounting and Dell Inc. was investigated after a review of past accounting and reporting practices and company eventually disclosed wrongful conduct for deferring revenue coming from software sales, errors and irregularities which took place from 2003 through 2007. The investigation concluded that a number of adjustment were improper, including the creation and release of accruals and reserves that appear to have been made for the purpose of enhancing internal performance measures or reported results, as well as the transfer of excess accruals from one liability account to another and the use of the excess balances to offset unrelated expenses in later periods. Also, the investigate found that personnel did not provide complete information to corporate headquarters and, purposefully…...

Similar Documents

Premium Essay

Change in Accounting

...Change in Accounting AC114/Accounting 1 Change in Accounting With everything, there is a time when changes are proposed to try to better a situation and make it more comprehensive for everyone. Saying this, there is a proposed change to the way the United States does accounting and financial preparations. Should we shift from U.S. GAAP to IFRS? I do not think that we should shift from U.S. GAAP to IFRS. I am attending Kaplan University at this moment to complete my Bachelor’s of Science in Accounting. Saying this, I do not want to have to go back to school to learn a new method of accounting and way of reporting financial statements. The second reason to not change to IFRS is that the United States has been using it’s own method for reporting financial statements for this long. Not to mention the fact that everyone is used to using this method. I do not think that it would be worth the time and money to get people trained on this either, especially if they are not interested in the new method. Saying this, if it’s not broke, don’t fix it. The differences of earnings between U.S. GAAP and IFRS have been studied. “We find that US GAAP and IFRS earnings perform equally well on value relevance, timelines and accruals quality” (Van der Meulen, Gaeremynck, & Willekens, 2006, p. 2). Although they perform equally in these categories, U.S. GAAP performs better in predictive ability (Van der Meulen, Gaeremynck, & Willekens, 2006). I...

Words: 350 - Pages: 2

Premium Essay

Role of Accounting on Business Behavior Impacted by Tax Changes in Malaysia

...Title: Role of accounting on business behaviors impacted by tax changes in Malaysia Justification There are many factors influence the changes of accounting importance where the role of accounting evolves along with the business changes affected by these factors. One of the factors that affect role of accounting in business field is tax. In Malaysia, Tax is generally divided into 2 types which are direct and indirect tax. Direct tax can be defined as tax which is imposed straight to the taxpayer. In short, the payment of tax is between taxpayer towards government. Examples of direct tax are income tax from employee salary, corporation tax, property tax, and etc. Meanwhile, indirect tax is a type of charge that can be transferred to the other person. A good example of indirect tax is restaurant that collect tax charge of the food’s sold from the customer (sales tax). Other examples of indirect tax are custom duty, central excise duty, and service tax). In brief, the history of Malaysia tax was started with more dependency towards indirect tax where establishment of direct tax has only started to take effect from 1 January 1948. This establishment has changed the trend of Malaysia tax which depends more and more on direct tax until today. In 2009 itself, government revenue has grown to 48.6% from direct tax. The urgency of understanding changes in accounting role due to tax, become important because of several reasons. Firstly, as the globalization of the economy develops...

Words: 1847 - Pages: 8

Premium Essay

How Technology Will Change the Accounting Profession

...ACC 700 How Technology Will Change the Accounting Profession Charles Duell, the director of the U.S Patent Office at the beginning of the twentieth century, prophesied that "everything that can be invented has been invented." Looking back, one can only laugh at the irony of this statement and the sheer amount that has actually changed since then. However, amidst the laughter, a question is raised: is it possible that today’s businesses believe what Duells said, that there is nothing more to come? Today, companies have access to some of the most groundbreaking technology, but are they truly taking advantage of it? One field that has changed dramatically over the past few years is the accounting profession, especially Certified Public Accountants (CPAs). Are CPAs staying on top of the latest technology that can greatly assist them in doing their job? For a better understanding of how technology directly affects the CPA profession one can simply look at the changes that have occurred over the past few decades, what a current office should be using, along with checking out the technological advances and how they will affect the career of CPAs in the next ten to twenty years. Not only is the accounting world changing, but the courses that an individual must study on the road to becoming a CPA, are also rapidly changing. The objective is to better prepare new graduates with a better understanding of the technology that will soon be such an integrated part of their lives.......

Words: 1920 - Pages: 8

Premium Essay

Discuss the Changes That Occurred in Financial Accounting over the Last 2 Years

...Accounting for Financial Decision Making Discuss the changes that occurred in financial accounting over the last 2 years. Table of Contents ______ 1 Basics of financial accounting 3 2 Changes in financial accounting over the last two years 4 2.1 IAS 1 Presentation of Items of Other Comprehensive Income (OCI) — Amendments to IAS 1………. … 5 2.2 IAS 12 Income Taxes (Amendment) — Deferred Taxes: Recovery of Underlying Assets.. 6 2.3 IAS 24 Related Party Disclosures (Revised).. 7 2.4 Annual improvements adopted by the IASB 8 2.5 IAS 27 Consolidated and Separate Financial Statements . 8 4 References 10 Basics of financial accounting Financial accounting can be defined as: The process of preparing financial statements for a business. The three key financial statements are: 1. Income statement. 2. Balance sheet. 3. Statement of cash flows. They serve two main purposes: a. To report on the current financial position of the company. b. To show how well a company performs over a period of time. Financial statements are used by shareholders. These are investors, creditors and other interested parties who rely on such information to find out whether a business is making or losing money, and they depend on financial accountants to ensure that these statements are materially correct and understandable. Financial accounting is a specialised branch of accounting that keeps tract of a company’s financial transactions. Using......

Words: 1926 - Pages: 8

Premium Essay

Changes in Accounting

...Changes in technology have led to new and improved digital information systems, and therefore changing the various aspects of the accounting profession. These changes include but are not limited to things like online banking, online bill pay, and plug-ins like the neat desk organizer. While some may not appear to directly affect the accounting profession, I will provide clear evidence that links them to the various changes in jobs like Forensic Accountant, IRS Criminal Investigation Special Agent, and Chief Financial Officer. First of all, online bill pay allows customers of companies such as Verizon to pay their bill with a credit or debit card without ever swiping their card. You may ask how this is even remotely related, but companies store the information you put in on the payment page in an electronic file for each customer and the technology used to pay the bill also records the payment on the company’s end. This cuts out a lot of the paper trail and allows companies to store payment records with your personal information, and their financial records in one place without having to input the information multiple times in multiple locations. Having the information put in by the customer decreases the chances of transposed numbers and misspelled names when the information is input in the next system, and having all the information in the same database allows information sharing among the different systems. For the CFO, or Chief Financial Officer, having everything at the...

Words: 805 - Pages: 4

Premium Essay


...bulk of the people. In fact, today most people who live in this region are no longer able to meet their basic needs and must depend on foreign aid--including food aid for survival. According to Cornwell, these economies "must grow at least 4-5 percent annually to achieve food security, provide jobs and register a modest improvement in living standards" (Cornwell, 1991). Recent data on macroeconomic performance in the region, unfortunately, do not indicate that the region will be able to achieve such growth, given existing incentive structures. According to World Bank, only Botswana (4.4%), Equatorial Guinea (6.0%), Mauritius (4.4%), Seychelles (3.7%), Uganda (3.3%), and Egypt (2.5%) had reasonable rates of economic growth-as measured by changes in the gross national product (GNP) per capita-during the 1987-1997 period. Most countries in Africa had negative rates of economic growth--Angola (-13.1%); Cameroon (-5.6%); Cape Verde (-9.7%); Democratic Republic of Congo (-9.5%); Sierra Leone (-4.4%); and Republic of Congo (-3.5%), just to name a few (World Bank 1999). Of the thirty poorest countries in the world today, as measured by the UNDP's human development index (HDI), twenty-five of them (83%) are found in Africa. According to a study by the Washington, D.C. based Population Crisis Committee, over 90% of the countries with the highest levels of human suffering in the world can be found in Africa (Hogendorn, 1992). In addition to the fact that Africa is the poorest region of......

Words: 4822 - Pages: 20

Premium Essay

Complexities of Leasing, Taxation, Error Correction and Changes in Accounting

...Complexities of leasing, taxation, error correction and changes in accounting Phase 3 Group Project/Group A Paula Campbell Colorado Technical University Online Professor Monica Phillis  ACC346-0902A-01: Intermediate Accounting II  April 28, 2009 Recommendation The accounting team has thoroughly researched the defined contribution plan, defined benefit plan and simple plan that are under consideration to install at BC Corporation. The defined benefit plan is the most costly and complex plan. It also carries an excise tax if the minimum contribution requirement is not met. The simple plan is just what it implies simple with limited options. The defined contribution plan has many advantages for the employer as well as the employee. It is less costly than the defined benefit plan and is easier to administer. This plan is also tax advantaged due to the contributions and earnings being tax deferred money. The advantages for the employee are it’s portable, has strong growth potential and the contributions are pre-tax. (Sepe, J., Spiceland, D., & Tomassini, L., 2007) With these advantages we can predict greater participation in the plan. Our recommendation is the defined contribution plan. It is the most advantageous for the business and can grow as we grow. The accounting for the defined contribution plan will reflect on the income statement and balance sheet. For the income statement the amount of the contribution is recorded as an operating expense usually......

Words: 533 - Pages: 3

Premium Essay

Climate Change and Its Effects on Accounting Practices

...Climate Change and its Effects on Accounting Practices William Conder Accounting 5233 November 26, 2013 Abstract in Climate change is a subject that invokes many different opinions and reactions from different people in different regions. Although there is a general consensus in the scientific and environmental advocate communities as to that the worldwide climate is changing, specifically warming, and that the activities of man are the primary cause, as for the degree of change and the possible effects, there is anything but a consensus. There is a fairly new concept that is taught in many businesses, colleges, and universities called the triple bottom line. This is referring to the three things that businesses should concern themselves with and strive to achieve excellence in if they wish to be sustainable; they are “profit, people, and the planet” (Elkington, 1995). The purpose of this research is to find out and explore some different ways that businesses today are utilizing good sustainability practices, and dive into some other areas like accounting for carbon emissions, and also seeing how accounting for predicted outcomes might work in the business environment. The environment affects us all and any sort of change, contingency, or preparation has to be accounted for, so this work is designed to find out how it is being done, and things that could be done to improve business. The triple bottom line The age old practice of businesses being concerned strictly......

Words: 3762 - Pages: 16

Free Essay

Communcating Accounting Standard Changes

...The recent release of the Statement of Accounting Standards No. 112 regulation made it necessary to communicate the standard and its impacts to the accountants within the firm. It was also imperative to make our key clients aware of the regulation and how it might affect their business. Finally, to ensure seamless compliance with the regulation, we are educating our clients’ bookkeepers of the regulation and its ramifications on their duties. When accounting standards are updated, the changes often must be communicated to several different audiences, as demonstrated by this change. Communicating this information to different audiences presents several challenges that need to be carefully navigated. One challenge that exists when communicating to different audiences is that they have a need of different levels of information. In the example here, our client’s senior leaders need to possess a high level understanding of the change so that they can properly manage the new expectations that their staff will need to follow. The bookkeepers will need to understand the implications to their job functions. The firm’s accountants, however, will need to understand the full breadth of the regulation to ensure compliance to the new standard. A second challenge is the need to understand the knowledge base of audiences that are being addressed. Not every audience will possess the same understanding of accounting. As a result, the materials delivered to different groups must be......

Words: 570 - Pages: 3

Premium Essay


...proudly flaunt a head start in this arena.Yet, before we present India’s case, let’s briefly scan some recent happenings, particularly in the US, that led to an erosion of trust in Corporate Inc. worldwide.Erosion of Trust in Corporate Inc. The turn of the millennium has witnessed mammoth bankruptcies, accounting scandals and obstruction of justice allegations. The consequent tarnishing of gilt edged names like Enron, WorldCom, Xerox, Arthur Andersen, Kodak, to name a few, has had widespread ripple effects in the corporate world. Yet news continues to pour in…KPMG, the big accounting firm, agreed to pay $200 million in suits arising from audits of Rite Aid and Oxford Health…Bristol Myers, the pharmaceutical giant, inflated sales by $2.75 billion in 1999-2002. The National Association of Securities Dealers (NASD) has charged an executive of CSFB with fraudulent allotment of hot IPOs to 300 of his corporate executive friends, to persuade them to prefer CSFB for their investment banking business. The new management of Tyco, whose CEO and CFO are under criminal prosecution for frauds totalling $600 million, is discovering more new scandals. Health South has been charged with an accounting fraud of $1.4 billion by inflating insurance claims. There are a number of suits, in what could turn out to be the biggest case, against Citigroup, J P Morgan and other investment banks for helping Enron and other companies to commit fraud, and for rigging IPOs to defraud the investing......

Words: 7312 - Pages: 30

Free Essay

Changes in Accounting Research over the Last 30 Years

...emergence of new research directions around the organizational and social aspects of accounting. During this time the accountancy profession was rapidly growing and moving into many new areas, there was a new standard-setting process, greater use of accounting controls in both private and public-sector enterprises, new forms of social accounting, intervention by government in the inflation accounting debate and calls on accounting to change in diverse directions. All of these rapid changes were forcing accounting academics to analysis the changing world of accounting more closely. (p454 30 years of historical accounting research) One of the changes in accounting analysis was a move towards accounting history. Hopwood (1976)called for historical studies in terms that would later be labelled as “traditional”, despite the label it would receive in the future, it still represented an awareness that historical studies would soon be an important source of understanding of the roles of accounting in organizations and society (reference 30 years of historical accounting research). Historical research was slow to emerge, as was highlighted in the Accounting, Organizations and Society journal where between 1976 and 1985 only 13 historical papers were published. Historical research came to the fore during the period from 1986 and 1990 where 22 historical papers were published in the journal Accounting, Organizations and Society, this period was also the time where there was the......

Words: 1874 - Pages: 8

Premium Essay

Discuss the Relative Importance of Physical and Human Factors in Accounting for Changes to Vegetation over Time Within Ecosystems in the British Isles.

...The British Isles, located in the northern hemisphere, is home to a temperate climate in which a large variety of plants including deciduous tees grow. Species within heathland, forest and lake biomes make up the ecosystem of the country. In the British Isles, physical and human factors are changing vegetation in these ecosystems. Physical factors can be things such as succession, changes in climate, natural disasters and diseases. Human factors include cultivation, development, exploitation, tourism and deforestation. In the past, Britain was largely covered in deciduous forest. About 5000 years ago, humans started to cut many of the trees down so they could build their homes and use the wood as fuel for cooking and the cleared areas for growing crops. The cleared land in the early Middle Ages would have been used for agriculture such as sheep grazing, which would have damaged the soil and allowed heather to grow and dominate any surviving plants. Many moorland areas, such as the Pennines, were originally thickly forested. Mesolothic hunting caps that existed many years ago could have resided on the moors, but there is little evidence for this. If these camps existed, they may have wished to use the nearby vegetation resources for firewood, which is also what the Anglo-Saxons and Vikings who came to the area did. These activities are significant because about 75% of Britain’s land is used for agricultural purposes. This is a type of human activity that has......

Words: 1982 - Pages: 8

Premium Essay

A Critical Review on Stability and Change: an Institutional Study of Management Accounting Change Written by Associate Prof. Dr. Siti Nabiha Abdul Khalid and Proffesor Robert W. Scapens

...This is a critique on the paper Stability and change: an institutional study of management accounting change written by Associate Prof. Dr. Siti Nabiha Abdul Khalid and Proffesor Robert W. Scapens Purpose The purpose of this paper, as stated on the first page, is to explore the relationship between stability and change within the process of accounting change. It focuses on the ceremonial implementation of value-based management and how key performance indicators can become decoupled from day-to-day activities which thereby creates a level of stability which can be ultimately contributed to the accounting change. Theoretical Framework This paper uses the framework set out by Burns and Scapens (2000) which is mainly based in Old Institutional Economics (OIE). In this paper institutions are defined as “The shared taken-for-granted assumptions which identify categories of human actors and their appropriate activities and relationships”. (Siti-Nabiha, A. and Scapens, R. (2005), Stability and change: an institutional study of management accounting change, Accounting, Auditing & Accountability Journal, Vol 18, No. 1, pg 46) Burns and Scapens argue that, when a particular management accounting practice is decided on, that over time this practice becomes accepted as “the way things are done”. The behaviour is disassociated from the original reason for the choice of this practice and comes to be applied in a rule-like manner and as a routine activity. The original...

Words: 2127 - Pages: 9

Free Essay

Discuss the Relative Importance of Physical and Human Factors in Accounting for Changes to Vegetation over Time Within Ecosystems in the British Isles

...and rainfall is between 30 and 60 inches. Deciduous trees are physically adapted to the climate of the British Isles. A prime example of a deciduous woodland is the New Forest which is situated in the south east of the UK in Hampshire. It has a total area of 17325ha of woodland. It has a variety of deciduous trees for instances maple, beech and oak. The New Forest is dormant during the winter months due to the cold weather. It is too cold for the trees to protect their leaves from freezing so they lose them. By losing their leaves, trees are able to conserve water loss through transpiration. Most animals hibernate during the winter months to protect themselves against he cold and reduce their need for food. In terms of human factors accounting for the ecosystems of the British Isles, there can be many impacts upon the ecosystem due to human interference. Successions can be stopped from reaching their climatic climax or defected to another climax by human interferences. This is called the plagioclimax community. Arresting factors in such a situation are activities such as deforestation, animal grazing and fire clearance. The burning of heather moorland is an example of a plagioclimax community. This is when the herbs/grasses/flowering plants/ferns sere is maintained as the highest succession. Shrubs are burnt to stop succession, leaving heather ferns behind as they are pyrophytic so don't burn. Secondary successions are ones that develop on land that has previously been......

Words: 1279 - Pages: 6

Premium Essay

Change IJPSM 14,2 Managing organisational change in the public sector Lessons from the privatisation of the Property Service Agency Ron Coram and Bernard Burnes Manchester School of Management, UMIST, Manchester, UK Keywords Organizational change, Public sector management, Privatization, Government agencies, Public authority assets Abstract Whilst organisational change appears to be happening with increasing frequency and magnitude in both the public and private sectors, most of the major studies of change focus on the private sector and tend to derive their approaches to change from that sector. From a review of the literature, it is argued that there is no ``one best way’’ to manage organisational change but that public sector organisations need to adopt an approach to change which matches their needs and situation. The article examines the privatisation of the Property Services Agency (PSA) in order to draw lessons as to how the public sector can and should manage change. It is shown that the privatisation was characterised by a lack of clarity, an over-emphasis on changes to structures and procedures, and staff resistance. However, underpinning this was an inappropriate approach to change. The article concludes that the main lessons of the PSA’s privatisation are that, in such circumstances, it is necessary to adopt an approach to change which incorporates both the structural and cultural aspects of change, and which recognises the need to......

Words: 7817 - Pages: 32