ACCOUNTING CASE STUDY question 1: a)Give two examples of when legal accounting c

Question

ACCOUNTING CASE STUDY

question 1:

a)Give two examples of when legal accounting conduct might be unethical - describe how you might manage this in your organisation,if your employees were found engaging in such conduct. Please explain with reference to the AESB standard.

b)Discuss the possible ethical issues that might have arisen from the structural connectedness between the News Limited and NRL competition prior to 9th February 2012. Applying the APESB, what ethical principles and threats might be relevant here?

c) How does the salary cap audit ensure the maintenance of ethical behaviour by clubs in relation to player salary payments?

NRL salary cap case study - independence and crisis management Setting the scene At the outset of the 2010 National Rugby League (NRL) season, the Melbourne Storm was held up as one of the most professional and successful clubs in the history of rugby league. Having been introduced as a team into a century old NRL competition approximately 14 years ago, in a state (Victoria) not traditionally known for its rugby league prowess, the club had amassed multiple premierships and other achievements (competition winners) In the four seasons to 2010, the Storm had collected four consecutive Grand Final appearances, three minor premierships (first placed in the regular season) and two premierships. It boasted a playing roster replete with international stars and a management team considered to be one of the most professional in Australian sport. However, on 22 April 2010, this legacy was emphatically and irrevocably altered. Story broke of the Melbourne Storm being implicated in extensive salary cap cheating, giving it a seriously unfair advantage in the NRL competition. The ensuing crisis, involving arguably the biggest fraud in Australian sport history significantly threatened the viability of the Storm and the legitimacy of the NRL. It also implicated some of Australia's best-known sporting heroes in wrongdoing, and conjured salacious allegations of unethical and deceitful conduct. A summary of key players in the Storm salary cap are presented in Appendix C. More generally, for a description of the sport of rugby league, see Appendix B Strategic Management Accounting and Crisis Management As markets become more competitive and transparent, companies are expected to respond to strategic threats more so than in the past. Additionally, innovation has accelerated as organisations attempt to innovate more intensely in the face of increasingly rapid product and service duplication by competitors (Richardson, 1996). These possibilities have caused companies to reflect on the nature of their strategic risks, and their manner of controlling them. Controls guide manager and employee behaviours, ensuring managers act in ways considered desirable for achieving firm objectives. As a subset of this function, organisations impose control systems to guard against the eventuation of strategic risks. When strategic risks relate to innovation concerns that drive strategic renewal, the Levers of Control (Simons, 1995) provides an outline of how senior managers might impose control practices to inspire beliefs, identify boundaries, diagnostically evaluate performance and interactively liaise with staff to ensure competitive advantage is maintained. This represents the management of a strategic risk (the loss of competitive advantage). From a more operational standpoint, organisations might implement the Merchant and Van der Stede (2007) People, Action and Results control framework, which clarifies how controls can be used to influence how employees might be selected, resourced and culturally aligned to an organization (people controls), be provided direction, guidance and physical access to help perform their work functions and finally, incentivised and rewarded appropriately for their part in achieving firm objectives (results controls). These three control types might be deployed to address employee lack of direction, lack of motivation or personnel limitations.

Explanation / Answer

Answer to Question 1 :

Two example of Legal Accounting conduct is as followws.

1. Ghost Employees in System - This can be manage by having salary verication every month provided by HR by nance team. This will ensure that no most employees are given salary who are not in system

2.To report wrong Prot : This can be manage by having Audit of Revenue as well as expenditure by having independent team in company whose only work to have deck on Income and expenses whid1 are booked in books of accounts This will also create fear in mind of employee who thinks of doing it and fooling the management mder shadow of unrealistic profit.

Answerto Question 2:

Conict of Interest mig1t have arisen frornm structual connectedness between the News United and NRL Competition priorto 9th Feb 2012Applying APESB conict of Interest would be relevant threat here.

Answerto Question 3 :

Salary Cap Audit will have rigorous independent review where reason would be available and will ensure the maintenance of ethical behavior; by clubs in relation to player salary payments

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