Case Study Whistleblowing - 1815 Words

(a) In your opinion, do you think whistleblowing will work in Malaysia? Elaborate on the reasons in support of your opinion. In my opinion, Whistle blowing will not work in Malaysia. From the passage, this is due to several reason. Firstly is due to culture, culture is where a group of people believe and behave the same way as it is. From this case, Malaysias culture is to prefer to keep things their own secretly. Basically they just dont want to review what is happening and just keep quiet and act nothing which is also known as open 1 eye close 1 eye basis. Just like in an office, many of them just prefer to keep quiet even bad things are happening, they just don’t want to get involve and end up being boycott or something else. Secondly†¦show more content†¦Protecting the identity of the whistle blower can be of paramount importance. To report an incident which exposes another individual can be seriously dangerous to the person doing the reporting and cases are documented where such whistle blowers have lost their lives. Anonymous reporting can reduces the perception that when significant matters are reported they not be affected. It can to ensure whistle-blowers can safe and disburden to report. For example, when employee Edmund anonymous whistle-blower his manager or supervisor fraud, it can avoid manager or supervisor makes him trouble after the case. That is because manager or supervisor will never who are the whistle blowers. To effective anonymous whistle-blowing is considering mode of communication of compliant. Depend on the communication channel it can represent a confidential level. People will think that is it the communication channel are safe for them to make compliant or is it confidential enough. The best channel is hotline and 24/7 operates. When make reports whistle blower is not necessary to provide them personal information. But it must provide sufficient corroborating evidence to justify the commencement of an investigation. Hotline operates 24hours per day; it can let people easy and free to make report when discover the misconduct orShow MoreRelatedCase Study: Whistleblowing in the Tobacco Industry961 Words   |  4 Pages Case study: Whistleblowing in the tobacco industry Q1. Briefly discern and report the background for the ethical situation. The tobacco industry has a curious status in the American economy and in American culture. On one hand, virtually everyone knows that tobacco is dangerous to human health. Unlike consuming alcohol, there is no safe limit for consuming tobacco and unlike powerful prescription drugs, nicotine has no medicinal value. The number of people in the U.S. who die each year fromRead MoreCase Study of Ethics5588 Words   |  23 PagesDilemmas Case Studies Professional Accountants in Business December 20112 Contents Introduction ...............................................................................................................................3 Case Study 1...............................................................................................................................5 Pressure to overstate stock valuation ...................................................................................5 Case Study 2...Read MoreThe Technological Revolution Has Changed The Access Of Citizens Within A Democracy1728 Words   |  7 Pagesavenues to make their concerns known is turning to the internet as a ‘platform for the swift dissemination of material and a layer of anonymity’ (Savage 2013) and this new era of what is known as whistleblowing has given rise to cyberethics. According to the Congressional Research Service, whistleblowing is defined as â€Å"making a disclosure evidencing illegal or improper government (and corporate) activities† (Whitaker cited in Koh, 2012). The individuals who make these disclosures are termed whistleblowersRead MoreThe Ethics Of An Organization1422 Words   |  6 PagesThe term that applies to reporting employees who commit immoral, illegal or illegitimate practices is referred to as whistleblowing. Whenever used in the context of an organization, whistleblowing is a controversial issue. The case study that I choose to talk about is one that happened in May of 2002. A woman by the name of Coleen Rowley, who works for the FBI, testified to the senate and the 9/11 Commission about how the FBI’s internal organization mishandled information related to the Twin TowerRead MoreWhistleblowing in The Medical Community Essay example1334 Words   |  6 PagesBouville (2008) describes whistleblowing as an act for an employee of revealing what he believes to be unethical or described as an illegal behaviour to a higher management (internal whistleblowing) or to an external authority or the public (external whistleblowing). Whistle-blowers are often seen as traitors to an organisation as they are considered to have violated the loyalty terms of that organisation while some are described as heroes that defend the values and ethics of humanity rather thanRead MoreA Case Study On The County Hospital Essay989 Words   |  4 Pages Introduction In this case study on the County Hospital (CH) the problems that this organization faced will be discussed. The case study explores in detail leadership, business ethics, strategic management, accountability, stewardship, whistleblowing, organizational change and performance architecture. The case will also mention the necessary steps taken to restore the organization proprietary within the market. The organization will determine/evaluate its culture and environment. Furthermore, CHRead MoreCorporate Approaches to Responsible Business1492 Words   |  6 Pages Week 8 Tutorial: Corporate Approaches to Responsible Business (Assessed) Critical Reflection: Question 6 (Shaw et al textbook, pp.198-199) Read the Kellogg case before your tutorial and prepare typed answers to the following questions. Question 1 : Do you think that Kellogg’s CSR statement is sincere, or is the company merely trying to convince stakeholders that it is a socially responsible company? Explain. Answer: CSR statement of Kellogg has deceived the public as their products has beenRead MoreWhistleblowing1650 Words   |  7 PagesHistory of Whistleblowing The definition of a whistleblower is a past or pesent employee or member of an organization, who reports misconduct to people or entities that have the power and presumed willingness to take corrective action, or to notify the general public of wrongdoing. In most cases, whistleblowers are employees of the ogranization but can be employees of government agencies as well. Normally the misconduct being reported is a violation of law, rule, regulation and/or a direct threatRead MoreU.s. National Security And Foreign Policy1427 Words   |  6 PagesAbstract: The theoretical and qualitative research findings discussed in this paper support the claim that the cases of Aldrich Ames and Edward Snowden led to monumental changes in U.S. national security and foreign policy. The effects of these cases extend beyond domestic change and have instigated international repercussions in both intelligence practices and diplomatic relations between the United States and multiple countries. Moreover, research acquired from journals, academic books, congressionalRead MoreWhistleblowing Case1640 Words   |  7 PagesThe Whistleblowing Case Studies There are various cases about whistleblowing, one of them is the case of Motorola CFO, Paul Liska.1 He has been fired after giving a presentation. In the presentation, Liska pointed out to Motorola directors that the cell phone unit, Mobile Devices, missed its sales projection for the preceding three months. Liska intended to attack Sanjay Jha, the head of Motorola’s cell phone division, by doing the presentation at the board meeting. The whistleblowing occurred because

Corporal Punishment and Children - 1935 Words

Is corporal punishment needed to discipline children? This is a very controversial question that is often debated. Even with as many arguments as there are against corporal punishment, there are also arguments for such punishment for children. This is something that tends to happen in both home and school settings. This type of punishment is very hurtful to the child and can have lasting effects on the child throughout their life. It can cause damage to relationships. It can also cause many different psychological problems as they get older. While some may not agree, there are other ways to discipline children that can be just as effective without causing any harm. What exactly is corporal punishment? Often referred to as child abuse,†¦show more content†¦Self-esteem and self-worth are often thought of as the same thing, but they are actually very different. Self-esteem is defined as, â€Å"a confidence and satisfaction in oneself† (Merriam-Webster.com, 2013). Self-worth is defined as, â€Å"respect for or a favorable opinion of oneself† (Merriam-Webster, 2013). Thinking highly of yourself and respecting yourself are very important and those that have been abused often think of themselves as unworthy and unlovable. Aggression is often also an issue for those that were disciplined using corporal punishment. They are taught by what is being done to them, for example, being spanked, that it is then okay for them to hit others when others do something that displeases them. This attitude is then carried over into adulthood and those children, now adults, will be more prone to getting into physical fights with others, with thei r spouse, and will be more likely to use corporal punishment on their own children (Morris amp; Gibson, 2011). Just as there are many different ways to negatively punish your child, there are just as many ways to properly discipline your child. Positive reinforcement is what is often considered to be the most effective way to get an undesirable behavior stopped. Positive reinforcement does not damage the parent-child relationship, and it also does not cause the child any negative psychological problems such as anxiety and fear. PositiveShow MoreRelatedCorporal Punishment Of Children.981 Words   |  4 Pages Corporal Punishment of Children When I was in middle school at St. Mary’s Catholic School, in Ethiopia, I used to see our teachers using different techniques to punish my classmates. I remember an incident in middle school where a friend of mine was punished in a harmful way because he failed to answer a question. Although the use of corporal punishment in schools is intended to change the behavior of the student, teachers should not be allowedRead MoreThe Corporal Punishment Of Children1223 Words   |  5 Pages Corporal Punishment of Children Thesis: Although using the corporal punishment method in schools is intended to change the behavior of the student, teachers should not be allowed to use this method to punish students because it’s not effective for the child’s behavioral change, and it affects the child’s behavior mentally and physically. I.Hurts the child physically and abuses the child right II. Destructive rather than constructive A. Many people believe that corporal punishment is a methodRead MoreCorporal Punishment And Its Effect On Children1587 Words   |  7 PagesThe term corporal punishment is defined as the use of physical force with the intention of causing a child to experience pain, but not injury, for the purpose of correction or control of the child’s behavior Seven nations Sweden, Finland, Denmark, Norway, Austria, Italy and Cyprus-have laws making it illicit for parents to utilize physical discipline on their children. Corporal punishment in schools has been banned in every one of the nations in Europe, South and Central America, China and JapanRead MoreCorporal Punishment And Its Effect On Children1708 Words   |  7 Pagesviewpoint on corporal punishment; some of the reviews take a look at who is most affected by corporal punishment in terms of focusing their lens on race, socio-economic status, gender, culture etc. Some also take a critical look at the advantages and disadvantages of corporal punishment. Some take a look at the widespread of corporal punishment in the US. Cases against corporal punishment and the effect of corporal punishment on children were also looked into. With all the different ways corporal punishmentRead MoreCorporal Punishment And Its Effect On Children1617 Words   |  7 Pagesof any child’s life is a huge determinate of what their future will turn out to be. Parenting styles are the normative prototypes that parents utilize to socialize and manage their children. Different parents employ different styles of discipline to ensure that their children develop to be all-rounded adults. Children who have been nurtured well by their parents turn up as self-regulated with disciplined behavior. Child discipline is thus a key parenting skill, and the choice of discipline styleRead MoreThe Effects Of Corporal Punishment On Children932 Words   |  4 PagesChildren and Corporal Punishment Punishing children has been one of the most controversial parenting topics this generation has seen. Physical punishment or corporal punishment is simple defined as the use of physical force with the purpose of initiating pain, but not wound, to teach the proper behavior of a child. Corporal punishment has been used for many centuries in schools and in homes but the use of such techniques have since decreased and are not being used in many places today. EvidenceRead MoreThe Effects Of Corporal Punishment On Children953 Words   |  4 Pagesmany views of the past relating to corporal punishment have changed significantly. During my readings I read things that instantly stood out to me. The first being how many issues and their solutions revolved around religion. John Wesley, was the founder of the Methodist Movement, and he believed that children were born with sin and that it was the parental duty to discipline the unruly child, starting at an early age. During this time period, corporal punishment was a common practice. Wesley usedRead MoreThe Effects Of Corporal Punishment On Children2225 Words   |  9 Pagesinternet that will point out the simple pros and cons of Corporal punishment. Many children psychologists state that violence will always produce violence, it will never reduce aggression. This is a generally accepted fact that has been proven and studied for decades. Will someone such as a child, not act out against an aggressor because of the natural drive to preserve their inherited material? There are usually four things that children who have experienced child abuse will do in later years. OneRead MoreCorporal Punishment And Its Effect On Children1860 Words   |  8 PagesReading/Writing L9 17 March 2015 Corporal Punishment by Spanking in Children Corporal punishment is hared way for children. According to Carol Bower, in the article Positive Discipline and a Ban on Corporal Punishment Will Help Stop Cycles of Violence. parents rely on corporal punishment on their children because violence is an acceptable way to solve problems. â€Å"The data showed that 57% of parents with children under 18 used corporal punishment, and 33% used severe corporal punishment in the form of beatings†Read MoreCorporal Punishment And Its Effect On School Children1251 Words   |  6 Pagesdistribute our findings so that all of the public cannot ignore the wholesale infliction of pain and suffering onto our school children, and the role â€Å"paddling† schools play in teaching our children that physically aggressive and coercive resolutions of conflict are legitimate. Contributing to the problem of violence by making children feel rejected and isolated, corporal punishment is unsafe in and of itself, but its discriminate application may be co-incident with problems unique to racial and gender

Understanding Responsibility For Detecting †Myassignmenthelp.Com

Question: Discuss About The Understanding Auditors Responsibility For Detecting? Answer: Introduction The ASA701 Communicating Key Audit Matters in the Independent Auditors Report, is the latest standard that was developed by the IAASB. The main aim behind this standard is to improve the overall audit practices and to remove the loopholes that are present in the system. The standard was developed to specify certain key matters on which the auditor needs to gives his opinion. It makes a specification on the important duties of the auditor while conducting the process of audit. This standard is applicable on the audit of all the listed companies and all the auditors needs to follow the same and mention it in their audit report(Abbott, et al., 2016). The auditors can follow the directions of the management or comment on the overall key matter on his own will. This standard was issued in December 2016. It is one of the biggest changes in the standards of auditing since 2004, when they were first issued. There were many factors that led to the same. However the most important factor that was behind the issue of these standards was the global crisis that the world faced when the ABC Learning company went into liquidation. As much as the management of the company was responsible for the same, the auditors were also equally responsible. However no actions could be taken against them because they made their point clear that the responsibility of the auditor is to check the accounts till he finds them to be inaccurate. If he finds that there are no errors than he does not need to comment on the validity of the accounts. This raised a big question on the responsibility of the auditors and had in turn led to the issue of the new standards. Every auditor was asked to follow the same and comment on the same in their financial reports. If they do not comply with the provisions of this standard then they will be punished for the same(Brannen, 2016). This was the main reason why the standard was developed. In this reports we will analyze this reason in detail, and also tell som e brief facts about the standards. And give some recommendations by which the auditors can improve their overall area of operation and make the reports as accurate as possible. Downfall of the ABC Learning Centre The ABC Learning institute was founded in 1988, and was one of the biggest educational institutes in Australia. It had many number of day care centers that imparted education and other services to large number of children and adults. The company was earning a lot of revenue and in 2001 the company was listed on the stock exchange. The total after tax profit of the company was A$143.1 million, and the overall revenue was A$1.7 billion. But due to many reasons the company suffered a major setback and went into liquidation. This affected the investors who had invested in the shares of the company and they suffered huge losses. The company had taken huge loans, because of which they earned huge losses. All these affected the health of the company which led to its delisting and finally led to the liquidation of the company. There was a huge fall in the share price of the company from A$8.62 to A$0.54. This reflected how badly the investors were affected and what setbacks they suffered bec ause of all this. There were several factors that were collectively responsible for the downfall of the company such that the overall business model of the company was not effective(Burke Clark, 2016). The company indulged in taking large amount of loans and also indulged in aggressive takeovers that had affected the overall market value of the company. The company also had incurred huge capital expenditures that were not mentioned in the audit reports. When the investors tried to analyze the main reasons behind the downfall of the company they found that the business model of the company was not up to the mark and the auditors have stated nothing of this in their reports. This raised a question on the authenticity of the audit reports and also made the government aware that there were some major loopholes in the system. If the auditors had audited the accounts properly then these factors would not been hidden and the management would have been made aware about the same. Thus we fi nd that along with the management of the company that indulged in malpractices, the auditors were also equally responsible in covering the shortcomings of the company. They gave a false picture to the investors that the company was earning huge amount of profits and the company was in a very stable position. The company had appointed Pitcher Partners as their auditors and they held this position for six long years. The auditors worked as per the discretion of the management and their audit report was framed on the same. Their decisions were influenced by the decisions of the management and they stated the same in their audit report. As per their reports the company was a profit earning institution and their going concern assumption was held true. But in reality there were many loopholes in the management. The company had shown huge amount of profit from loss making units , moreover they had a large number of intangible assets in their balance sheet whose valuation was not stated completely(Guragai, et al., 2017). Most of the intangible assets that consists of derivatives, goodwill, and other biological assets were hard to identify and value. Most of the revenues and the payments that the company was showing in their financial statements was from loss making units and the same were merely El Dorado. The auditors supported all these claims of the company and also gave an unmodified audit report that stated that the financial statements were showing the true and fair view. However, when the new audit Ernst and Young took over they had a very different opinion from the previous auditor. So they further probed into the matter and saw that the management of the company had indulged in a lot of malpractices and the same was supported by the previous auditor. They asked the management to make the necessary changes, however the management refused to do so as that might need them to change the entire scenario of the business and these would have cost them large amount of losses(Jones, 2017). When the management refused the new auditor issued a modified report in which it made clear that the management was not supporting them necessary details and also the company was not a going concern. But the previous auditor was not ready to accept the same. This led to a situation of a deadlock between the two auditors, the government finally appointed a third party to comment on the validity of the accounts and the two audit reports. The third party was not able to reach to any conclusion. Hence both the reports were held to be true and both the auditors were fixed on their decisions. This led to a lot of upheaval and a big question mark was raised on the authenticity of the audit reports. The previous auditor was not led guilty because they made a claim that it was no where mentioned that the auditors had to make assertions on specific matters. The auditors only need to check the account for their own satisfaction(Knechel Salterio, 2016). This led to the need of a new standard and hence the ASA701 was formed as per which the auditors needed to comment on the specific matters of audit and mention the same briefly in their audit reports. In case the auditor fails then he will be held liable by the court of law. This provided a limitation on the overall actions of the auditors and the necessary steps that they need to take to make sure that the books of accounts of the company are free from errors and the same mus t be very clearly stated in their audit reports. The main points that was concluded from this downfall was that there was a gap that was present between the demand of the investors and the auditors responsibilities. Just in the case of the ABC Learning we see how the actions of the auditors were responsible for the fail of the investors. The companies need to make sure that the audit report is genuine and the auditors must make sure that they are doing their duties genuinely. This standard will help the auditors in identification of the key matters on which they need to comment. This is an important change that was brought in the overall functioning of the auditors(Lefkowitz, 2017). Features of the ASA 701 This standard helps provides those guidelines that the auditors need for their development and the overall corporate governance. It is applicable on the audit of all the listed companies and every auditor needs to follow the same. The key features of this standard are It gives the auditor the chance to identify the key matters and comment on the same. They can take consultation with those charged with governance on the important matters that are affecting the company. But the decision of the auditor will be his own and wont be based on any biasness. The auditors mostly focus on those areas where there are chances of certain amount of risk like accruals, revenues, cost booking and taxes etc. All these require the auditor to make certain judgment, some estimations and recommendation and then prepare the audit report on the basis of the same. The auditors needs to define and explain each of the key audit matter in details and need to make proper recommendations on the same. The auditors must consider the effect of these key matters on the overall profit and the revenue of the company. It must be supported with proper research and findings and proper reasons behind each estimation must be given(Raiborn, et al., 2016) They also give a list of certain specific matters that cannot be included in the audit report. In case the same was included the auditor must give proper explanation of the same. It is important that the auditor must prepare a proper audit evidences file that must be maintained properly and will help the auditor in cases they need future reference. This will help the auditor is keeping a trail of the steps that were taken by them. Effect of the ASA 701 on the ABC crisis Previously these audit standards were not applicable and hence they worked negatively for the shareholders and the decision markers, but the auditors and the management of the company benefited from the same. If these standards were defined previously it would have helped the auditors in identifying the key matters on which they need to comment. In case if they fail, and worked as per the decisions of the management of the company, then they can be held liable and can be punished. In the case of ABC even if the previous auditors were known to be guilty no action was taken against them as they had made use of the loopholes that was present in the auditing standards. Thus this lead to a dead lock between two auditors who had different opinions(Sonu, et al., 2017). But with the introduction of this standard it was made clear that the auditors need to identify and comment on the key matters. This put a limitation on the overall actions of the management and the auditors and also gave the investors an insight into the financials of the company, which they can use to comment on important matters. The major loophole that was present in the auditing standards was removed and this embarked the biggest change that ahd taken place in the auditing standards since 2004. Thus we see how ABC learning and its downfall was responsible for the formation of these standard and what effect does it have on the overall functioning of the auditors. Conclusion From all the analysis it can be said that the auditors of the company must be true and fair in their approach. The investors are relying on their reports to take important decisions with their money, hence it becomes their duty to provide an unbiased report. In the given case we see that the auditors of the company were not true to their work and had malfunctioned in their actions. This had caused huge losses to the investors of the company. Thus the need for clear and transparent audit practices becomes more evident(DeZoort Harrison, 2016). It makes it more clear on how important it is that the financial statements that are prepared must be clear as so many stakeholders like banks, investors, the general public all are dependent on it in some way or the other. If the auditors had done their work properly the investors would not have suffered such huge losses. Thus it becomes clear that the issuance of the new standard was the need of the hour and all the companies must make it a po int to make sure that the auditors are stressing it in their audit reports. As for the auditors it is important to follow the same else if they are held guilty there are no more loopholes in the system that could save them. Recommendations It will thus be recommended that all the parties performs their duties with utmost conviction and genuineness there must not be any falsification of records that might give false picture to the investors. It is very important in the long run to make sure that the books of the companies are prepared free of errors else in the long run it wont be possible for these companies to survive. The companies those who indulge in malpractices will get liquidated one day. Hence it is requested that proper framework that has been defined must be followed and all the decisions must be taken on the basis of the same, so that none of the parties have to bear any losses. It is important that the actions of the auditors must be timely checked so that they are not able to do any mistakes. It is very important that all these auditing standards must be followed very seriously. It is important for the all round global development and health of the companies and the professionals around the world. References Abbott, L., Daugherty, B., Parker, S. Peters, G., 2016. INTERNAL AUDIT QUALITY AND FINANCIAL REPORTING QUALITY: THE JOINT IMPORTANCE OF INDEPENDENCE AND COMPETENCE. Journal of Accounting Research, 54(1), pp. 3-40. Brannen, J., 2016. Mixing Methods: Qualitative and Quantitative Research. NY: Ashgate Publishing. Burke, J. Clark, C., 2016. The business case for integrated reporting: Insights from leading practitioners, regulators, and academics. Business Horizons, 59(3), pp. 273-283. DeZoort, F. Harrison, P., 2016. Understanding Auditors sense of Responsibility for detecting fraud within organization. Journal of Business Ethics, pp. 1-18. Guragai, B., Hunt, N., Neri, M. Taylor, E., 2017. Accounting Information Systems and Ethics Research: Review, Synthesis, and the Future. Journal of Information Systems: Summer 2017, 31(2), pp. 65-81. Jones, P., 2017. Statistical Sampling and Risk Analysis in Auditing. NY: Routledge. Knechel, W. Salterio, S., 2016. Auditing:Assurance and Risk. fourth ed. New York: Routledge. Lefkowitz, J., 2017. Ethics and Values in Industrial-Organizational Psychology, Second Edition. second ed. NY: Routledge. Raiborn, C., Butler, J. Martin, K., 2016. The internal audit function: A prerequisite for Good Governance. Journal of Corporate Accounting and Finance, 28(2), pp. 10-21. Sonu, C., Ahn, H. Choi, A., 2017. Audit fee pressure and audit risk: evidence from the financial crisis of 2008. Asia-Pacific Journal of Accounting Economics , 24(1-2), pp. 127

Abrams Company Essay Essay Example

Abrams Company Essay Paper MANAGEMENT CONTROL SYSTEMS Lecturer : Supriyadi, Ph. D. Nama : Handy nugroho - No: 1157021 Case : Abrams Company Abrams’Company manufactured a wide variety of parts for use in automobiles, trucks, buses, and farm equipment. Abrams sold their product both to the OEMs and the wholesalers. top management is satisfied with their management systems and performance measurement scheme but they are three areas of concern that need to be discussed. * First, the transfer prices disagreements of parts sold by the product divisions to the AM division. Second, is in the product divisions too often tended to treat the AM division as a captive customer and in the performance measurement system. * Third, the excessive yearly inventory carried by both the AM division and the three product divisions. Strength The company has a clear management structure. The company has employed a bonus plan for employees. The AM Marketing division will input products form the other three divisions, and sell it to domestic and foreign market, it helps the company save cost when it input internal. Weaknesses Abrams’ business model weakness is that its divisions operate as independent companies. Furthermore, all of these profit centers, participate in an incentive compensation plan that the higher the participant is in the organizational hierarchy, the more â€Å"incentive points† he or she will receive based on division profit variance. The Abrams Company has three totally independent divisions, and the three divisions are lack of connection. The transactions between the three divisions dispute the transfer pricing. Case Analysis and Recommendation The Abrams case is about using profitability measures to evaluate profit centers. In EU companies it is more common to evaluate PCs with Income measures like RI and EVA. It is very difficult to find a relevant and fair capital base for the ROI measure. Abrams use book value for fixed assets which inflate the ROI measure as the assets age. The age and mix of assets also differs among divisions which give unfair measures. It is also easy for the divisions to manipulate the capital base at the end of the year. ROI based bonus may rob the future, who want to invest in assets if that reduce the bonus. We will write a custom essay sample on Abrams Company Essay specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Abrams Company Essay specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Abrams Company Essay specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Recommendation to this company was to use RI or EVA instead of ROI and to control the investments separately using NPV and capital turnover measures. The bonus should be based on the budgeted income level, the RI target. The current transfer price system seems to work well with few disputes. Market prices are more used as a top-level for the TP. An advantage with cost base TP is that it will give all internal partners full information about the cost structure and you will avoid â€Å"upstream fixed costs† The problem with the inventory level cannot be controlled with ROI management. If the company change to RI/EVA it will be possible to to negotiate relevant inventory levels in the budget process. High inventory levels can also be managed with differentiated capital charges that will create high interest costs. The best way to control operational tasks is to use nonfinancial measures such as inventory turnover. Use nonfinancial measures to control the inventory levels. If it is an strategic issue you can connect this measure to the bonus system. In general, Abrams Company adopts the lowest cost, differentiation, market focus and ROI strategies to accomplish the organization’s goal. Furthermore, In order to implement the strategies the firm establishes its own management control systems. Suggestions  to  performance measurement  system: 1) ROI can be used combination with other performance measures to avoid the limitations of ROI. The company can establish a non-financial performance measurement system such as the balanced scorecard . With a good performance measurement system, the incentive compensation plan will be improved. 2) EVA ( Economic value added) can be used instead of ROI Suggestions to transfer pricing : a transfer price fixed by the top management in compliance with the AM division and the other divisions involved which could be revised when it is out of date. This fixed price could be adjusted due to inflation. There should be an internal policy on it. Therefore, top management should implement a c ost-based transfer prices because when competitive prices are not available, transfer prices may be set on the basis of cost plus a profit markup.