Purpose, Background, and General Criteria:
This writing assignment covers conceptual material and is designed to help build your understanding of the material through focused critical thinking.
Content, concept application, and writing quality will impact your grade.
Writing Assignment #1:
Now that we have completed chapters 1-5 you have been exposed to all four financial statements (Income Statement, Statement of Retained Earnings, Balance Sheet, and Statement of Cash Flows,) the account types (Revenues, Expenses, Assets, Liabilities, and Equity,) and ideas about internal controls and ethics as they relate to accounting. You have also worked on topics that include managements estimates for particular amounts, managements choice about an accounting method to use, or transaction that would likely require management approval. It is time to purposefully consider how these topics relate to each other. Additionally, it is important for business students to develop an ethical decision-making model and a sense of good ethical behavior. This assignment is intended to help work on both those objectives.
Part 1 Financial Statements and Internal Control
Describe why you think it is important for external stakeholders to have access to a companys financial statements. Consider who external stakeholders may be and provide some examples of how or why the external stakeholders would use a companys financial statements.
Why is an adequate environment and system of internal control important for an organization in order to produce reliable financial statements? Find an example of an organization that does not have strong internal control. (You can search to find examples or use personal experience, or both.) Describe what you think contributed to the organizations internal control weaknesses.
Part 2 Ethics and Fraud
Briefly describe what ethics are and how you think ethical standards apply to the business environment. Include in your answer a description of the fraud triangle and how you think the fraud triangle is related to both internal control and ethics.
How could management in a business unethically use their influence or responsibilities to produce financial statements that are misleading? Would it be fraudulent if they did so? Why or why not?
Part 3 Ethics and Cheating
Why do you think high ethical standards are an attribute that our school expects of its students? Do you think cheating or acts of academic dishonesty that occur in your academic environment impact the value of your education and the value of your college degree?
Do you think that a student who commits acts of academic dishonesty can be a trustworthy business partner in the future?