Paranoia or Internal Control?

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Ethical Dilemma, Financial Accounting, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized.

Red Star Operating System is North Korea’s homegrown computer operating system that mirrors its political one. The latest version (circa 2013) is based on a version of Linux called Fedora and has the feel of Apple’s OSX.

Questions:

1. What are the two major challenges the article said that Pyongyang faces? From an international business perspective, what challenges does this OS pose?
2. What other countries either have their own operating system or have tried to build their own operating system?
3. From an internal control point of view, what are the advantages of Red Star? What are the disadvantages of Red Star?

Source:
Wagstaff. J. and J. Pearson. (2015). Paranoid: North Korea’s computer operating system mirrors its political one. Reuters.com, Dec. 27 (Retrievable online at http://www.reuters.com/article/northkorea-computers-idUSKBN0UA0GF20151227)

Kim Jong

Whistleblower in an Unusual Case

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, Auditing, Cost Accounting, Ethical Dilemma, Financial Accounting, Fraud Accounting, Intermediate Accounting, Managerial Accounting.

According to Newsweek, David Danon, a former Vanguard tax lawyer, became a whistleblower two years ago when he filed formal complaints with the Internal Revenue Service and many state taxing agencies claiming that Vanguard’s low fees are an illegal tax dodge.

Questions:

1. According to a 2006 law, how much could Danon stand to collect as a whistleblower in this case?
2. According to the article, what do Vanguard customers stand to lose?
3. Discuss the reasons why Vanguard charged such a low fee, why this case is so unusual in terms of whistleblowing, and how the case issues might be resolved.

Source:

Johnston, David Cay (2015) Vanguard Whistleblower Could Get Billions in Tax Dodge Complaint. Newsweek, Dec. 3 (Retrievable Online at http://www.newsweek.com/vanguard-whistleblower-tax-dodge-complaint-400901)

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Sam’s Club CEO, Rosalind Brewer, Talks about Changes and Lessons Learned

Posted by & filed under Accounting Information Systems, Accounting Principles, Cost Accounting, Financial Accounting, Intermediate Accounting, Managerial Accounting, Video Updates.

The rivalry between Sam’s Club and Costco comes close to what you find in college sports.

Questions:

Source:

1. What things did the Sam’s Club CEO say were learned about Black Friday?
2. What happened to CostCo stock versus Sam’s Club Stock in 2015?
3. What are the differentiation strategies that Sam’s Club is implementing?

Source:
Long, H. (2015). Americans are saying ‘supersize me’ again. CNN:Money – Stockswatch, Dec. 11 (Retrievable online at http://money.cnn.com/2015/12/11/investing/sams-club-costco-big-tvs/index.html)

The Great Experiment

Posted by & filed under Accounting Information Systems, Accounting Principles, All Articles, Cost Accounting, Financial Accounting, Intermediate Accounting, International Accounting, Managerial Accounting.

Finland has become the latest country to propose a basic income for all. Under the plan, all Finnish citizens would receive an 800 euro stipend, per month, tax-free.

Questions:

1. Based on the current exchange rate, what amount of U.S. dollars is this equal to?
2. What incentive does Finland have to implement this proposal?
3. What does the Finnish proposal seek to simplify?
4. What other country is proposing a similar nation-wide referendum?
5. How was the 1968 U.S. experiment different from these proposals?

Source:
Armbrecht, D. (2015). Finland might pay everyone in the country 800 euros a month.Business Insider, Dec. 12 (Retrievable online at http://www.businessinsider.com/finlands-basic-income-experiment-2015-12)
Money-file-2

Will the Fed or won’t the Fed?

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized.

Ms. Janet Yellen indicated in testimony before Congress on November 4, that an interest rate increase could come in December 2015. But she added that no decision had been made.

Questions:
1. When was the last time that the Fed raised interest rates?
2. Where has the benchmark interest rate been since Dec. 16, 2008?
3. What were some of the other measures that the Fed used to prop up the economy after the financial meltdown?
4. What are some of the positive economic signals that weigh into an interest rate hike?
5. What are some of the negative economic signals that weigh into leaving the interest rate alone?

Source:
Granville, K. (2015). Why December Is Looking Likelier for a Fed Rate Increase. The New York Times, Nov. 23 (Retrievable online at http://www.nytimes.com/interactive/2015/business/economy/fed-interest-rates.html)

Stagefright!

Posted by & filed under Accounting Information Systems, Accounting Principles, All Articles, Auditing, Cost Accounting, Financial Accounting, Intermediate Accounting, Managerial Accounting.

According to Jeff Larson, for the last five months, military officials and officers have continued to use phones that can be attacked by the “Stagefright” bugs, a collection of flaws in the phones’ software code that gives attackers access to everything that flows through compromised devices.

Questions:
1. How is the military adding to the vulnerability of its cell phone systems?
2. What government agencies have been compromised by Chinese and Russian hackers during this year?
3. What are some of the reasons for the potential vulnerability problems for the military?
4. After reading this article, what are some of the unnecessary risks that the military could eliminate with good internal controls?

Source:
Larson, J. (2015) Telecoms, Manufacturers Delaying Critical Patches for Classified Military Smartphones. ProPublica.org, Nov. 9 (Retrievable online at http://www.propublica.org/article/critical-patches-for-classified-military-smartphones-delayed)

groupon1

Security Chips and Bearing the Cost of Fraud

Posted by & filed under Accounting Information Systems, Accounting Principles, All Articles, Auditing, Cost Accounting, Ethical Dilemma, Financial Accounting, Fraud Accounting, Intermediate Accounting, International Accounting, Managerial Accounting.

New payment cards, issued over the last year, come with a small square security chip that can help make in-person transactions more secure. However, retailers complain that they have spent billions of dollars upgrading their payment terminals to accommodate a system that cuts down on the fraud shouldered by banks, but not merchants.

Questions:
1. According to attorneys general mentioned in the article, what type of additional internal control should be added to the card procedure to make transactions more secure?
2. By October 1, what percentage of banks had complied with the new chip technology?
3. What are some of the fees and requirements mentioned in the article that support the notion that retailers are bearing a large part of the cost of fraud?

Source:
Abrams, R. (2015) Chip Credit Cards Give Retailers Another Grievance Against Banks. The New York Times, Nov. 17 (Retrievable online at http://www.nytimes.com/2015/11/17/business/chip-credit-cards-give-retailers-another-grievance-against-banks.html)
A Citibank sign is seen outside of a bank outlet in New York

Avoid the crowds with Black Friday Apps

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Ethical Dilemma, Financial Accounting, Intermediate Accounting, Managerial Accounting, Video Updates.

Questions:
1. What are the benefits of Nifti?
2. What are the benefits of ShopSavvy?
3. Based on the information in this article and video, if you were a brick-and-mortar retailer, what would you do to counteract the convenience of these apps and get more traffic (that translate into higher sales)?
4. From an accounting standpoint, will these apps hurt or help retailers? Why or why not? Use potential revenue scenarios in your answer.

Source:

Tech Staff Writers. (2015). Video Feature: Replacing the Black Friday Rush With a Few Leisurely Taps. The New York Times, Nov. 25 (Retrievable online at http://www.nytimes.com/2015/11/26/technology/personaltech/video-feature-replacing-the-black-friday-rush-with-a-few-leisurely-taps.html)

Release Cards: Another High Interest Problem?

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Ethical Dilemma, Financial Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting.

As this article points out, unlike consumer debit cards, prison-issued cards are unregulated and subject to exorbitant fees.

Questions:
1. What are the typical charges for these cards?
2. For the person that had $120 and was able to use only $70, calculate the percentage of fees.
3. Who is making the money on these release cards and approximately how many states are using them?

Source:
Diallo, A. (2015) Release cards’ turn inmates and their families into profit stream. AlJazeera America.com (Retrievable online at http://america.aljazeera.com/articles/2015/4/20/release-cards-turn-inmates-and-their-families-into-profit-stream.html)
money_ball

Black Friday Worries

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Intermediate Accounting, Managerial Accounting.

According to this article, Black Friday Shoppers are opting out of the usual frenzied shopping day, because stores are diluting its effect with pre-Black Friday deep discounts.

Questions:
1. Why did FDR move Thanksgiving?
2. When did Black Friday begin to lose its luster and why?
3. Which of the retailing changes in the article do you think make the most sense?
4. In your opinion what does Black Friday tell us about consumer confidence?

Source:
Tabuchi, H. and N. Schwartz. (2015). Black Friday Falters as Consumer Behaviors Change. The New York Times, Nov. 25 (Retrievable online at http://www.nytimes.com/2015/11/26/business/black-friday-falters-as-consumer-behaviors-change.html)

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