The Reasons Behind The Largest Corporate Scandal Of India Accounting Essay

The Reasons Behind The Largest Corporate Scandal Of India Accounting Essay Satyam means Truth and the truth was revealed very late in case of Indias one of the largest IT company, Satyam Computers Services Limited. By the time, Satyam fraud came to public light, Ramalinga Raju, the chairman of the company, had already committed Indias largest corporate fraud ever. The first section of essay will discuss the reasons behind the largest corporate scandal of India. It will discuss why people with billions in banks go corrupt. In this section, it will argue on the negligence and violation of duty by various elements involved in the wrongdoing. Then, the next section of essay will state some recommendations to avoid further frauds or scams. In the first section, we will discuss why big businessmen or rich people who are very famous and known to the world, sometimes, step out of line of honesty. By doing this, they break the trust of people and lose all their repute and name that they had gained by working hard in their lives. The first reason for their divergence from honesty to dishonesty is sense of ownership. If a person is the only owner or founder of the company, then he finds it easy to do what he wants with his business. He thinks that it is his business and money. Security of getting away with any wrongdoing makes him comfortable. He becomes unaware of the consequences and keeps on doing wrong things again and again. The owners and founders of companies, sometimes, dont like outer interference in their business and they do only what, they think is best in their interest. Hence, this sense of ownership, somehow, leads to greed. They dont think of other people who put their money in business. They justify themselves that they are permitted to do what they want with that money because it is their business. They just ignore the rights of other stakeholders who are involved in business too (Kaur and Mishra, 2010). Hence their unethical behaviour cost them a lot at the end because one day everybody comes to know about crime. In Satyam case, ownership structure of Indian companies is also responsible to some extent. The popularity of family owned businesses in India led to concentrated business control. In this system, independent directors agree to act in interest of family group. They just ignore the interests of the company and minority shareholders and act in the way that is best for their benefit. Some corporations are generally structured in a pyramid structure. The pyramid structure comprises of some separate business lines. Different businesses are considered as one entity and are controlled by one group at the top. Thus, they can transfer money from one entity to another as required (Winkler, 2010). Hence, it can lead to tunneling. Tunneling is a process in which a control group moves money from one company to another company, where they possess bigger share. Also, in pyramid structure, it is hard for outside shareholders to check inner performance of business entities (Winkler, 2010). Because of pyramid structure and consolidated control of the business, board of directors of Satyam didnt do their duty independently. They approved the purchase of family owned company of Chairman Mr. Raju, Maytas properties and Maytas Infrastructure. It was not an IT company and Mr. Raju had larger shares in Maytas than in Satyam. Thus, ownership structure of business impacted the performance of directors in another way (Winkler, 2010). Another reason for the professional misconduct of billionaire businessmen is the desire to do something different. Sometimes they think that they have achieved everything in their life, so what is next exciting job for them. Thus, the thrill of danger involved gives them the drive to do something unusual. So, they tend to try new things in their jobs to gain more advantage out of their business. Thus, gradually, this tendency leads to their deviation from right to wrong and they cant step back because they merge themselves in the offence to that extent that they fear to get exposed to the public. So they keep on doing that without expecting to get caught one day. Sometimes, people start their offence with small misconduct. To get benefit, they just try a mischief by manipulating the account books by little difference. They think that is very easy as they didnt get caught. So, next year they again do that to cover last years gap. Then, they feel uneasy to stop that as they dont know how to get out of this. Hence, they commit that mistake again and again until that mistake gets transformed to a blunder and then to a largest fraud. In case of Satyam, Ramalinga Raju had to overstate the income every quarter to cover the last gaps. When he finally disclosed the fraud, he mentioned, It was like riding a tiger, not knowing how to get off without being eaten (Winkler, 2010 pg 5). Thus, a small mistake led him to the edge, where he didnt know how to get back and he became convicted of the scam of billions. In a competitive corporate world, billionaires become prone to be more successful than their rivals. They become habitual of winning. So, when they perceive that next situation is not going to be in their favour, it hurts their sense of pride. Thus, they become ready to do anything to maintain their status and repute. They just forget that by choosing wrong way to success, their pride will sustain for short term. For the long term, they will have to pay for every wrong deed. Thus, all the above mentioned reasons together give an example of weak corporate governance of India. Personal greed of the chairman and negligence of duty by board of directors and the audit committee resulted in a worst scandal in Indian history. Now, the second section of essay will provide some implications to prevent these types of corporate frauds in future. After Satyam scandal, Indian regulators started working for the improvement in corporate governance of India. The Securities and Exchange Board of India (SEBI) is a main regulatory authority for Indias stock market (Afsharipour, 2009). It proposed some regulations that should be strictly followed by all companies to maintain good governance standards. But, still it is difficult for the corporate government of India to make changes in their standards in short period of time to prevent further frauds. Still, it can be achieved by facilitating strict enforcement of their rules. First of all, government should take initiative by being strict in its laws and regulations. Government can initiate this from the roots of crime, that is, bribery. They should punish the bribe givers and bribe takers. The persons, who give or take bribe for their own interests and grab the rights of other people involved in the business, deserve punishment. It will help to prevent further corruption as people will avoid it for the fear of strict punishment. If still any person is involved in any kind of fraud or scam, they should be sent to prison and their assets should be seized. They should make suffer hard so that in future nobody will feel secure or easy to get away with a crime. Also, there are some duties of companies towards their employees. Employees should be encouraged to whistle blowing. Whistleblowing helps to avoid and eliminate evil and to decrease the probability of misconduct and dishonesty in an organisation (Grace Cohen 2010). All the employees should be aware of the means that how can they disclose unethical behaviour of board member or any other person in the company without getting affected. This would create a strict and honest environment in the companies as everybody will be afraid of getting caught if they would chose to be corrupt. Also, to make this step successful, whistle blowers should firstly, provide full protection. That will encourage them to follow the moral behaviour and stand against evil. This practice will play an important role in the prevention of corruption and frauds. Moreover, to get best out of their workforce companies can encourage employees to buy some shares from the company. If employees have some shares in the c ompany, they are working; they will work for the best interest of the company. They will not favour any bribery and stand against evil in firm. Hence, it will lead to best corporate results. To avoid unethical behaviours in companies, business should be run on the concept of Corporate Social Responsibility. Under this concept, businesses become committed to behave ethically. In the companies, duties are performed morally towards contribution to economic development, while considering the interests of employees, all stakeholders and society as a whole (Ferrar, 2008). CSR works in long term interest of the company and it also increases companys reputation. Hence, a company working on the concept of CSR will have good quality workforce who will focus on the interests of all the people attached to the business. In corporations, there are two audit committees. First is internal audit committee that is comprised of independent directors of the company. They scan all the operations in the firm including income statements. They make sure that no unreliable and false information regarding financial report would be given to the shareholders (Solomon, 2007). They are responsible for the internal audit system. Hence they ensure the accuracy of all the operations inside the firm. External auditors are the auditors from outside the company. They review the performance of internal auditors, that is, they check internal audit functions. They scan companys whole financial reporting process (Afsharipour, 2009). In India, there is need for more clear functions of audit committees. There is need for more independence and better composition of internal auditors. More frequent meetings of audit committees should be encouraged. It will help in more effective internal control. Also, more meetings will help in effective judgement and decision making (Al-Mudhaki and Joshi, 2004). Moreover, an audit committee should not work with a company for more than five years. They should be changed after every five years, otherwise, they will get lazy working with same company and they might get involved with some people of company. That can affect their performance as auditors because their job needs total unbiasedness. Final check of the financial reports should be done by anonymous external auditors so that directors will not find any opportunity to bribe them. Hence, effective role of auditors is very necessary to avoid corporate failures. In India, corporate governance has been put into practice through clauses of Companies act 1956 (Farias, 2001). Companies Act in India has been drawn a lot from UK Companies Act 1948 (Afsharipour, 2009). But, still Indian Companies Act doesnt put more stress on the independence and qualification of board of directors and investor protection. In India, lack of independent and qualified directors leads to weak corporate governance. Most independent directors are the university professors or government officials. They show least interest in their duties and monitoring the performance of management. According to Zhang and Rajagopalan (2008), to ensure unbiasedness and quality of boardroom, foreign directors can be appointed. Also, India can open its market for foreign investors. Hence, independence of directors will ensure right and unbiased decision making and avoidance of any influence from anybody. India corporate governance needs to put great emphasis on transparency and disclosure. Transparency and disclosure are very necessary to eliminate corruption and to ensure precision of all the operations performed in a business (Zhang and Rajagopalan (2008). Corporations should not hide anything from the public. They should be transparent and clear in their operations and disclose their annual agendas every year. They should state clearly in the beginning of financial year what they are going to do and how they are going to use the shareholders money. Companies should work in favour of more voluntary disclosure. They should disclose their balance sheet position more than once a year, perhaps twice. This will help to avoid mismanagement of account books. If there would any falsification in the statements of balance sheet then it will be prevented on time. Hence, transparency and disclosure in business adds up to the value and quality of operations in the business. Companies will be mo re honest and true in their approaches leading to achievement of good corporate governance standards. Reaction of American government to Enron scandal resulted in Sarbanes-Oxley Act (SOA) in 1992 which holds lots of reforms in corporate governance in America. SOA put great emphasis on certification system in corporations. According to this act, each quarterly and annual report must be certified by CEO and CFO of the company (Pinto Branson, 2009). They should review the financial reports themselves and should take responsibility. This law has been adopted by Indian Companies Act in Clause 49 but it doesnt put criminal liability in case of fake or wrong statement (Afsharipour, 2009). So, absence of criminal liability means there will not be any fear of law in people and they can easily alter the financial statements. There is no benefit in implementing a regulation with no strict criminal law on the violation of that regulation. Hence, if any law is implemented by the regulators, it should be strengthened with penalties, in case if somebody dares to break those laws. It will help to i nstall fear of law in minds of people so that they wont even think to go against laws in a corporation. Failure of Indian Judicial System to settle corporate conflicts is another reason for weak corporate governance in India (Afsharipour, 2009). Delays in making decisions in judiciary process often led to ignorance of issues. Hence, judiciary processes in India are strongly criticised because of their negligence of judicial system. Thus, more steps should be taken towards the reforms in Judiciary System. This will help in timely resolving of corporate disputes and ensure the effective corporate governance standards. Ministry of Company Affairs (MCA) is government regulatory body and Securities Exchange Board of India (SEBI) is independent securities regulator. Since creation of SEBI in 1992, there have been continuous conflicts between SEBI and MCA. (Afsharipour,2009). Simultaneous exercise of all legislative responsibilities by both regulatory bodies is increasing tension between SEBI and MCA. This conflict and competition between two groups is putting hindrance on the way of corporate governance reforms. SEBI adopted most of the legislative regulations but implemented few of them. Both of the groups have least focus on corporate governance regulations and more focus on undermining each other. So, authorisation of SEBI and MCA on the regulations in the companies should be managed effectively so as to resolve conflict between both groups. Both of the groups should work in harmony for the strict implementation of all the regulations and thus, it will further help to achieve better standards for t he corporate governance. Apart from these reforms, one thing that builds the foundation of the corporate governance is the ethics of people. So, it should be reformed from the roots. That is, students should be taught ethics in schools (Kaur and Mishra, 2010). Especially in a country like India, there is need for the honest and ethical people. Introduction of ethical education in schools would strengthen the roots of corporate governance. In conclusion, there is an urgent need to take revolutionary steps for the governance reforms to prevent corporate failures due to scandals. Hence, as no business can operate in a vacuum, directors have some fiduciary responsibilities towards stakeholders. If directors step out of line of honesty, they should be punished. The first part of essay identified some reasons for convergence in behaviour of billionaires that leads to large corporate frauds. The second part of essay provided some recommendations for corporate governance reforms which would help to prevent frauds in companies. After analysing all the points, this essay puts great emphasis on the implementation of strict laws against corruption. This would mark the prevention of debacles like Satyam for a longer time in the future. Word count: 2650

What factors contributed to the expansion of the Barnwell area from a small village in 1801 to a busy suburb of Cambridge by 1901?

* At the end of the eighteenth century Cambridge was suffering a significative diminuish of the population. We can notice this by looking at the statistics provided. Meanwhile in 1674 the population exceeded 9000, by 1728 Cambridge's population was under 8000. There were many reasons that could explain this sudden fall in population. One of them was the problem of overcrowding, and the repercussions that overcrowding causes. Possible consequences of this factor could have been: poor hygenical conditions ( lack of clean water for everyone, or excessive amounts of sewage which were hard to get rid of), lack of employment places for everyone, and also very high prices on the property market. This latter problem is strictly related with the expansion issue in Cambridge, which we will explore further on. Another factor which contributed to the fall in population towards the beginning of 1700, was the attraction that cities in the north exercised: this was the period of time in which the Industrial Revolution was fluorishing. In cities such as Manchester or Leeds ( typical northern cities), there was great possibility for employment, in the newly born industries. We will now analyze in more detail the expansion issue in Cambridge. The city of Cambridge was expanding at a very fast rate, but the space available for settlement was running short. The need for expansion claimed by the University, restricted the residential areas to delimiting and unpleasent territories. Cambridge was surrounded by land liable to flood, which was the main factor that stopped the centre of town and the residential areas from expanding. Cambridge was also surrounded by open fields, which seemed to be the only possible area in which the town could expand. These open fields, and areas surrounding the town, were mainly owned by the rich. This left the poor with the worst areas, both for settlement and agricolture. This unfair situation was overcome with the aid of the Enclosure acts, which were put in practice in 1802.. This movement entitled every land owner to a fair amount of land. For this goal to be made possible, the available land had to be divided into small strips which could be equally shared between everyone. By 1811 with the Enclosure award, the land surrounding Cambridge had finally been completely redistributed. Now that everyone had the same amount of land, the profit coming from the land would have been fairly regular, and there wouldn't be so much (disnivel) between the rich owners and the poor owners. The arrival of the Enclosure award had in a way slowed down the the fast rate at which the population was diminuishing. * The city of Cambridge had been various Ecclesiastical Parishes spread around throughout the town. Generally each area had its own Parish. During the century going from 1801 to 1901 we notice a fast rise in the population of certain Parishes, and especially the Parish of St. Andrew The Less, which was allocated in the Barnwell area (1 mile away from the city centre). The Enclosure Award in 1811, generally incremented the population of every Parish. The population gradually grew in certain Parishes, and although St. Andrew The Less had always seemed to grow at a faster rate than everother Parish, it wasn't only until 1845 and the following years that its population enourmously grew to reach a final peak of 27860 people. This population rise of this can be noticed when analysing the graph I developed. In other. We don't notice straight away in 1845 the rise in population because it takes time for settlement but in 20 years time from the statistics it is clear that rise in population is reaching its maximum peak. 1845 was the year in which the Railway was built in Cambridge, and this was a very important factor which contributed to the rise in population of this Parish. This is because the Railway was constructed in the Barnwell area. We will analyze further the reasons of such importance of the Railway, including an explanation of the ubication of this new medium of transport. For now we will only mention the where the people that populated the Parish came from. They were mainly traders, that had previously been using as a medium of trade the river and moved to the Barnwell area to make use of this new revolutionary transport which could have benefitted their business, and students and labourers from other towns that decided to move to Cambridge. The railway was faster and therefore a better value for money. As we notice from our statistics and our graph, St. Andrew The Less wasn't the only Parish in which we encountered a rise in population. Other Parishes that were situated near the river side, encountered a substantial rise in population. Not as dramatic as the one in the Parish of St. Andrew The Less, but significantly larger than the ones in Parishes ubicated in other parts of the town. An example could be the Parish of St. Andrew The Great. This Parish, as we can see from fig. ( map of Cambridge during the middle ages), is situated next to the River Cam, close to the place where once the fortress of Castle Hill was built. The reason there was a rise in population in the Parishes next to the riverside, is because some people were conservative regarding their means of transport. Many people still retained the river the best mean of transport for trading their goods. Although travelling through the river was slow, now that most of the population had moved next to the Railway, it would have been much faster to travel. Also with the diminuishing of people making use of the River Cam for their trading business, the taxes on transport through the River had fallen. Generally, using th river as a mean of transport now, had two advantages: travelling became much faster, and also cheaper. This can be seen from fig. 4 ( The River Cam toll receipts). We notice that gradually, from 1845 the tolls fell to eventually reach the value of 367 i per annum. Having said this, the Railway still remained the most popular mean of transport.

Information Gathering Obu Essay

Every Research Report requires information as the basis for analysis. Information sources can be categorised as either primary or secondary data. There is no requirement for you to collect primary data within your Research Report; it is wholly acceptable to undertake your Research Report using only secondary data. The difference between primary and secondary data is identified below. Primary data is original data that has been collected by a researcher by whatever means appropriate in the answer of a specific research question. . e. it has been collected specifically for the Research Report. Examples of primary data include questionnaires, interviews, e-mail contacts and surveys. If you decide to collect primary data as part of your research work, then you should state and justify the following: ? The data collection techniques you intend to use e. g. questionnaires, interviews. ? Your sample size and an outline of your sampling strategy. ? The method you will use to select your samp le and the likely response rate. If you intend to collect primary data from staff within your chosen organisation you must obtain permission to do this from a senior member of staff within the organisation. You should do this as early as possible during your Research Report, since if you are denied access to your desired information sources you may have to reconsider how to meet your project objectives and research questions. Secondary data is data that has been collected by others for their own purposes, but which may be used by a researcher for his or her different purposes. Examples of secondary data include reference material, books, CD ROMs and financial statements. You should always evaluate the appropriateness and relevance of secondary data sources. Information included in internet sources may not be reliable from an academic perspective and may not be appropriate for use in your Research Report. If you decide to use secondary data as part of your research work, you should state and justify your choice to do so. Where you use published secondary data you must provide precise references using the Harvard Referencing System. This is discussed in more detail in the following section. You must retain all of the information that you collected during your project work until you have received official notification of your RAP grade from Oxford Brookes University. This includes any questionnaire responses, copies of financial statements, extracts from journals, reports, magazines etc. Oxford Brookes University may wish to ask you to provide additional evidence of your information gathering following the marking of your Research and Analysis project.

Writing a Lesson Plan Anticipatory Sets

To write an effective lesson plan, you must define the anticipatory set. This is the second step of an effective  lesson plan, and you should include it after the objective and before the direct instruction. In the anticipatory set section, you outline what you will say and/or present to your students before the direct instruction of the lesson begins. The anticipatory set provides a great way for you to make sure youre prepared to introduce the material and can do so in a way that your students will relate to easily.  For example, in a lesson about the rainforest, you could ask the students to raise their hands and name plants and animals that inhabit the rainforest and then write them on the board. Purpose of Anticipatory Set The purpose of the anticipatory set is to provide continuity from previous lessons, if applicable. In the anticipatory set, the teacher alludes to familiar concepts and vocabulary as a reminder and refresher for students. In addition, the teacher tells students briefly what the lesson will be about. During the step, the teacher also: Gauges the students level of collective background knowledge of the subject to help inform instructionActivates the students existing knowledge baseWhets the classs appetite for the subject at hand The anticipatory set also allows the teacher to briefly expose students to the lessons objectives and explain how she will guide them to the end result. What to Ask Yourself In order to write your anticipatory set, consider asking yourself the following questions: How can I involve as many students as possible, piquing their interests for the subject matter to come?How should I inform my students of the lessons context and objective, in kid-friendly language?What do the students need to know before they can delve into the lesson plan itself and direct instruction? Anticipatory sets are more than just words and discussion with students. You can also engage in a brief activity or question-and-answer session to start the lesson plan in a participatory and active manner. Examples Here are a few examples of what an anticipatory set would look like in a lesson plan. These examples refer to lesson plans about animals and plants. The goal of this section of the lesson plan is to activate prior knowledge and get students thinking. Remind the children of animals and plants they have studied earlier in the year. Ask them to name a few of each and tell you a little bit about them. Ask students to raise their hands to contribute to a discussion of what they already know about plants. Write a list on the blackboard of the characteristics they name  while prompting them and offering ideas and comments as needed. Repeat the process for a discussion of the properties of animals. Point out major similarities and differences. Tell the children that it is important to learn about plants and animals because people share the Earth with animals and each depends on the other for survival. Alternatively, reread a book that you have read to the students earlier in the year. After finishing the book, ask them the same questions to get them thinking and to see what they can remember. Edited By: Janelle Cox