To PIN or not to PIN?

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

Some big U.S. retailers are stepping up efforts to use personal identification numbers, or PINs, with new credit cards embedded with computer chips in a bid to prevent counterfeit card fraud.

Questions:
1. Why is this being resisted by banks?
2. Which retailers are leading the movement?
3. Discuss the costs and benefits of the “chip and PIN” versus the “chip and signature.”
4. What does the EMV stand for in EMV chips?
5. When and what was the significance of deadline associated with EMV chips?

Source:
Finkle, J. (2015) U.S. retailers push banks to use PINs on credit cards as confusion reigns. Reuters.com, Oct. 30 (Retrievable online at http://www.reuters.com/article/2015/10/30/us-retail-banks-cards-idUSKCN0SO24D20151030)

Circumventing the Courts with Nine Words

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

Banning class action suits have essentially disabled consumer challenges to practices like predatory lending. Additionally, a Wall Street-led coalition of credit card companies and retailers, have also engineered blocks on class action suits. In this article, various companies’ efforts to protect arbitration are discussed.

Questions:
1. Why has the “birth of a thousand clauses” taken millions of Americans by surprise?
2. Which industry does the article point to as having the greatest understanding of arbitration clauses and what event or events triggered their education about arbitration?
3. Discuss why there is an opt-out policy rather than an opt-in policy for arbitration.
4. Who are some of the retailers that have class-action bans are included in the employment policies? Discuss the dilemma of giving up rights versus giving up a job.
5. Would you support arbitration for a business you owned? Why or why not?

Source:
Silver-Greenberg, J. and R. Gebeloff. (2015). Arbitration Everywhere, Stacking the Deck of Justice. The New York Times, Oct. 31 (Retrievable online at http://www.nytimes.com/2015/11/01/business/dealbook/arbitration-everywhere-stacking-the-deck-of-justice.html)
criminal-justice-logo-md

Bad Legal Advice or Bad Insurance Companies or Bad Laws?

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

One of my favorite quotes is that from author Wendy Mass: “Be kind, for everyone you meet is fighting a battle you know nothing about.” And so it seems that this story may illustrate it well. The article and video discuss the case of Jennifer Connell who sued her nephew, Sean Tarala, for $127,000 over an injury she suffered while at at his birthday party in Westport, Connecticut, four years ago. According to the suit, Connell fell and broke her wrist when she tried to catch Sean. Since that time, she has been condemned on social media as the “most wicked aunt” ever.

Questions:
1. Jennifer lost her suit after 25 minutes of jury deliberation. Should she have won? If so, who do you think is to blame?
2. Did Jennifer get good legal advice in your opinion? What would you have done in this case?
3. Do you think this was the only way to have her medical bills paid? Discuss.

Source: Whitten, S. Aunt Sues Nephew for $127,000 over Enthusiastic Birthday Hug. CNBC.com, Oct. 13 (Retrievable at http://www.cnbc.com/2015/10/13/aunt-sues-nephew-for-127000-over-enthusiastic-birthday-hug.html)

All Day Breakfast

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

In an email to franchisees, McDonald’s US President Mike Andres called the all-day breakfast launch a success. However, this article points to a survey of U.S. franchisees that disagree.

Questions:
1. Why are McDonald’s franchisees saying that the all-day breakfast launch has been a nightmare? List the reasons and rank them according to your opinion of their importance.
2. When did the all-day breakfast menu launch nationally?
3. Why is McDonald’s doing this launch now?
4. In your opinion, is it a good thing? How long should the company track it before claiming success or failure?
5. What performance measures do you think should be tied to the launch?

Source:
Peterson, H. (2015). McDonald’s franchisees say all-day breakfast is a nightmare. Business Insider, Oct. 15 (Retrievable online at http://www.businessinsider.com/mcdonalds-franchisees-say-all-day-breakfast-is-a-nightmare-2015-10)

A Solution for Legal Cannabis Cash?

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

Of the more than 7,600 banks and credit unions in the U.S., only about 220 accept cannabis cash, according to the Department of the Treasury.

Questions:
1. If Anthony Rivera Jr. accomplishes his goal, who will be the bankers for legal cannabis cash? In your opinion, is this a good idea? Why or why not?
2. How large is the annual revenue which is currently unbanked?
3. What model is Rivera’s group, CannaNative, mirroring?

Source:
Kaplan, J. (2015). Finding a Place for Cannabis Cash. Bloomberg – Businessweek, Oct. 15 (Retrievable online at http://www.bloomberg.com/news/articles/2015-10-15/finding-a-place-for-cannabis-cash)
Pot Banks

Vintage Frauds

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

The issue of fake wines started to become headline news a few years ago when the so-called Thomas Jefferson bottles, several old bottles of Bordeaux, claimed to have belonged to Thomas Jefferson were offered by a German wine collector named Hardy Rodenstock. Bill Koch, the brother of the notorious Charles and David Koch, bought four of these bottles in the late 1980s. Whe he learned in 2005 that there was a high probability that these were fake, he sued Rodenstock and launched a multi-million-dollar campaign to combat a flood tide of counterfeits.

Questions:
1. Who were some of the famous people in Kurniawan’s circle of wine friends?
2. What are the variety of ways mentioned in the article to counterfeit wine?
3. What actions by Kurniawan seemed like “red flags” of fraud?
4. How was Kurniawan able to supply such convincing fakes?
5. What was Kurnianwan’s biggest mistake?
6. According to one expert noted in the article, what percentage of pre-1980 Burgundies being sold at auction are fake?

Source:
Steinberger, M. (2012). A Vintage Crime. Vanity Fair, July (Retrievable online at http://www.vanityfair.com/unchanged/2012/07/wine-fraud-rudy-kurniawan-vintage-burgundies)

What’s going on with Walmart stock?

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

The four members of the Walton family controlling more than half the shares of Wal-Mart Stores Inc. had $11 billion of their combined net worth evaporate Wednesday as shares of the retailer plunged on a lower earnings outlook for the coming fiscal year.

Questions:
1. Who are the four Waltons that the article is talking about and what was their relationship to founder Sam Walton?
2. What was their combined fortune at the beginning of the year and what is it now?
3. According to the article, who are the other two stockholders that lost the most and how much did they lose?
4. What does Walmart CEO, Doug McMillon, point to as the reason why the company’s profit outlook will be lower for the next two years? How much lower in 2017? What is the potential growth from these changes?
Sources:

Coffey, B. (2015). Wal-Mart Heirs See $11 Billion Vanish in a Day on Share Fall. Bloomberg Business.com, October 14 (Retrievable online at http://www.bloomberg.com/news/articles/2015-10-14/wal-mart-heirs-see-9-billion-vanish-in-a-day-as-shares-plummet)

Oyedele, A. (2015). Wal-Mart Warns: Our profits will fall next year. Business Insider.com, Oct. 14 (Retrievable online at http://www.businessinsider.com/wal-mart-cuts-profit-outlook-2015-10)

Frauds in Small Family-owned Wineries

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

There have been a number of examples of wine-related crimes in recent times. In the wine industry, the most trusted employee could be the person least suspected of committing fraud. This article details some of the most recent frauds in the wine industry.

Questions:
1. What types of fraud are highlighted in the article?
2. Which of these types is the most common according to the article and the Association of Certified Fraud Examiners?
3. What are the warning signs of theft by an employee?
4. What are some of the preventative measures mentioned in the article to make as part of the business culture?
5. Could this article been written about any type of family-owned small business?

Source:
Huffman, J. (2015). Fraud experts tell wineries to wise up. Napa Valley Register.com, Sep. 22 (Retrievable online at http://napavalleyregister.com/news/local/fraud-experts-tell-wineries-to-wise-up/article_e717a080-92c9-5a15-b74c-5a59293d4a83.html)
Wine

A Better Shot than Getting Hit by a Bus? Time will tell…….

Posted by & filed under Uncategorized.

Robert Murphy, an unemployed 65-year old, took out several Parent PLUS student loans — federal debt parents can use to finance their kids’ education — to send his three children to college. For the last three years, he has been appealing his way to the Boston federal court that is now considering his case to discharge these debts. A win for Murphy would relieve him of hundreds of thousands of dollars in student debt—and could fundamentally change the way U.S. bankruptcy courts handle borrowers who can’t repay college loans.

Questions:

1. At the heart of his case is a Congressional exclusion from bankruptcy for student loans added in the 1970s. Explain this exclusion.
2. Undue hardship is one of the main keys to this case. Why? Explain its importance.
3. Why would it be a dangerous thing for the government if the First Circuit announces a rule for debtors to discharge their student loans in bankruptcy?

Source:
Kitroeff, N. (2015). This Court Case Could Unshackle Americans From Student Debt. Bloomberg Business.com, Oct. 8 (Retrievable online at http://www.bloomberg.com/news/articles/2015-10-08/this-court-case-could-unshackle-americans-from-student-debt)