Diffusion of new financial system in MHM Organization Assignment

Diffusion of new financial system in MHM Organization - Assignment Example But with the concept of globalization, the entire landscape of the accounting system in business changed. Every organization computerised their accounting system that reduced the work time considerably. Today almost every Multi National Company relies on modern accounting software and telecommunicating of accounting information to different units for running the business successfully and reaching clients all over the world. The company MHM is one of the chief suppliers of electrical equipments and it is currently operating in Qatar. The company was established in the year 1972 and it has also diversified in to other sectors including manufacturing, facilities management, contracting, and contracting. The company has the capability of handling large volume projects with limited assistance from third party. The strategic aim of the company is to empower the present electrical industry of Qatar with quality, technical expertise, and competitive price. The company has favorable attitude towards globalization and it also believes that with the introduction of new technology in various sectors, the opportunity to improve existing processes also increases. This is because with new investment in various sectors, foreign technological expertise and advice is also accessible (Harvie and Lee, 2002, p.172). The up gradation from old ways of paper based record keeping into automated software based entry manage systems is both challenging as well as rewarding. It is challenging in the sense that the company might face hostility from their employees who are not comfortable with technological advancements (Seacord, Plakosh, and Lewis, 2003, pp.1-2). Even till date there are some sections in the society that believes that machines can take over their jobs. Such negative sentiments have the potential to become a hurdle in the way of achieving company’s objectives in the long run. Hence it is important for the company to take care of such problems and provide proper traini ng to employees first so that the company does not face any opposition from the employees of the company (Hite and William, 2006, pp.22-25). The replacement of old fusion paper ways of financial recording into modernized computer software based recording is rewarding in the sense that automated record keeping reduces the time required for paper works significantly. Traditional ways of record keeping, especially in double entry system, required consistency which often led to clerical errors of accounting. In the automated systems, the computerized software has the ability to store or transfer the documents as per stored formats. The documents are saved and updated automatically whenever any changes are made or any transaction take place. At the same time the chances of losing important business critical document reduces as all the important data will be stored in centralized database. This would in turn also minimize the security requirements and the man hours of works taken by the a ccountants (Nobles, Scott, and McQuaig, 2012, pp.237-238). Strategic Role of New Technology The company’s business operations include Electrical showrooms, Facility Management, Electrical Switchgear Manufacturer, and along with this the company is also involved in MEP Contracting

Media culture and communication Essay Example | Topics and Well Written Essays - 500 words

Media culture and communication - Essay Example Narrated by Walter Huston and Dana Andrews, the film is 60 minutes long. It was shown to allied soldiers serving in the Pacific region during that time. Directed by Frank Capra on behalf of the US War Department, it was produced to inform the allied soldiers about the last enemy that remained in the war after the fall of Italy and Germany: Japan. The idea was that increased knowledge about the history and culture of Japan would create an understanding of the current situation that would cause a positive effect on the allied war effort. Every chance to condemn the Japanese and their ideologies were used in the course of the film. As this propaganda film was designed for army personnel being sent to fight the Japanese, it contains generalisations and stereotypical caricatures of the Japanese people and culture. Expected to have deliberate propagandistic content, this paper looks into the techniques of persuasion used. Embedding history and culture. Much of the film is devoted to the life of the average Japanese, Japanese religion and the part religion played in the rise of Hirohito as the Emperor of Japan. There is an explanation of how the warlords, reviving and misusing the old Shinto religion created a Japan that became a belligerent world power rather than a peaceful one. Japanese citizens are portrayed as being raised from a very young age to be soldiers, thought to be the â€Å"highest human achievement† in their society. Japanese values such as the collective-versus -individual character, and the willingness to die for one’s master, among others, are exploited to show the negative side of the Japanese. In reality, however, these are issues irrelevant as to why Japan should be fought. To the Japanese, these values have proven positive to them. Brooding sound and visual effects. There are animated sequences in the film. Clips from Japanese samurai films of the 1930s lend a brooding visual effect. Made up

Bobs Dilemma Essay Example | Topics and Well Written Essays - 1000 words - 18

Bobs Dilemma - Essay Example As the discussion stresses, employees who wanted to further their careers at the company had to work hard and keep family out of it. If Bob would take his paternity leave, his teammates would have to fill in for him, which he is afraid would create resentment. Additionally, he is worried that it will harm his career. Bob decided to take the advice of his colleagues on the issue. Mike, his married teammate, told him that the job’s structure required one to be quiet regarding family needs if one wanted to move up and talked to him about the use and abuse of the policies. Manuel, who is his best friend and single, is of the belief that those without children face discrimination. Judy, a 38-year-old single mum, was of the opinion that the uses of benefits made an individual seem less dedicated and affected their performance appraisals. Finally, Jessica, who is a recent college graduate, opined that company policy provisions are there to be used. One communication theory that appli es in this case is formal communication vs. informal communication. Communication involves sharing of information for purposes such as influencing, motivating, persuading and informing. Formal communication is distributed across an organization in an organized manner downwards flowing from executives regarding company policy and upward from the staff in the form of reports and data. This kind of information is well planned and established. Informal communication, on the other hand, works to satisfy emotional and social needs without basis on the positions that individuals hold in the organization. The most common term for it is grapevine and is considered as rumor or gossip. Information flowing through this channel can be exaggerated or deleted, causing inaccuracies. Employees use this channel when they feel vulnerable, such as in this case where Bob is searching for help on his issue by talking to colleagues.

Emerging Technologies Of Century Computer Science Essay

Emerging Technologies Of Century Computer Science Essay This paper outlines the two emerging technologies and their impact on society and on business. Emerging technology, the name it self implies the technologies that are emerging or growing with time as result of researches in those technologies. Some of the emerging technologies are nanotechnology, cloud computing, biogenetics, robotics, artificial intelligence etc. Here we are discussing two prominent emerging technologies of 21 century, * nanotechnology and * Cloud computing. Nanotechnology is a dominant technology in all areas in coming decades. It will have revolutionary changes in health sciences, energy resources such as water etc. Many business organizations are interested in investing nanotechnologies to gain the fruit of the technology Cloud computing is a virtual emerging technology that increases the speed of the computing applications at lower costs. It permits us to perform unlimited applications and data storage either with in organization or over internet. Now we discuss these two technologies in brief. Introduction: Emerging technologies are bringing revolutionary changes as because of growth in technology. In the present paper we are discussing brief about the two emerging technologies, cloud computing, nanotechnology. And in each technology a brief explanation of technology, its growth and applications is presented. And the discussion leads us to social and business impacts of both technologies in positive and negative faces with the evidence from statistical data. Lets start with the cloud computing. Cloud computing: The idea about the cloud computing is very complex. Of the several meanings, Lets go with one of the meaningful definition. What perfectly is a cloud computing? From its easiest form, the terminology, â€Å"cloud† will be a metaphor which originates from the symbol of cloud on a flowchart of the network designer, which is indicating that the information about the packet will be sent over the Internet. â€Å"The term ‘cloud computing encompasses many areas of tech, including software as a service, a software distribution method pioneered by Salesforce.com about a decade ago. It also includes newer avenues such as hardware as a service, a way to order storage and server capacity on demand from Amazon and others. What all these cloud computing services have in common, though, is that theyre all delivered over the Internet, on demand, from massive data centers.† While the cloud computing has been move into IT jargon in the most recent days, the market at the consumer point of view is using more longer. More people in the united states are connecting to the Web services over the some variety of service with cloud service, containing web based emails. In the same manner, Google and Amazon are the largest companies which are using â€Å"cloud† from so many years. And as The Economist (Oct. 25 2008) notes, â€Å"Firms that provide enterprise software as a service (SaaS) over the Internet, such as Salesforce.com and NetSuite, have grown steadily.† Fresh businesses, without any legacy funds to protect, and with the easiness which are presented by Information Technology resources which are being provided over the off-premise position in metered quantity (as much or little as needed) and quality which are likely to find out the cloud facilities which are mainly appealing. Upton now the conclusion is very clear for the customers in the enterprise. They are hesitating to invest large investments and want to have services from outside. Some of the barriers which may be needed to overcome are data availability, security, geographic location of programs, having small support of commercial ISV. Now days many MNC companies are struggling with old hardware, requirements of power and with very complex data centers. To overcome this situation they have to adopt a hybrid computing model called cloud computing. How to make cloud vision to reality â€Å"cloud computing† means the computing which dynamically facilitates access to the measurable services, which are shared to each other in a network that may be private or public. These services takes place from IT services which are basic ( like storage, power for computing etc. to computing services which is specific for industry (like logistics, healthcare and finance). In this cloud computing the storage is infinite and programs can be accessible anytime, anywhere. What could Cloud computing enables: 1) Previously new and fresh business models which were not implemented because of technical limitations in existing system. 2) Business ideas which may need less consumption of computing power and preventive measures. 3) Information sharing without the very high coordination costs, reductions of cost and increase in some IT service responses to companies, governments and mostly for individuals. 4) According to some studies cloud computing have good effect on economic progress. 5) In future millions of new jobs can be get through Cloud computing because of the development of many of tiny business. There are many doubts to develop cloud in any disruptive technology. Some doubts are about the delays to develop the cloud, and some doubts are the effect of privacy laws and restrictions. 6) Some are concerned about the possibility of long delays or problems in the development and deployment of cloud. Four types of cloud players are emerging:  § Providers of Cloud Amazon, Google and also dozens more and more; they have their own set up of the hardware.  § Publishers of Cloud Vendors contribution web services ,SaaS, and application expansion platforms for making cloud applications  § Enablers of Cloud Companies that make platforms, standards, tools, etc. enabling continuous grid computing in the cloud by providing the groundwork for inventiveness (SLAs) Service Level Agreements. GRAPH 1: MEMORY BENCH MARK DISK AND PERFORMANANCE Impact on business: Mediation is a secret weapon The importance of a intercession layer is not distinctive to cloud computing. From the provider changes the mediation of the is created by the enterprise. This is the most single perilous architecture improvement a company could make when the cloud is using, because that permits the inventiveness to alter on their self-terms and which is not be given by the exterior provider. Continue to consider service level management Mediation also helps a secondary key advantage, which of policy and control enforcement. Addition of mediation layer which offers the enterprise with the perceptibility into how the cloud computing will be used and and also controls to declare enterprising of standards. To determine optimizing business and determining the risk Visibility is critical. Mediation permits watching of the vendors servicing level contracts to authorize that theyre transporting as assured in methods that are significant for the business. Keep a focus on security: Reasonably, security has the information technology executives largest protest linked with the cloud computing. All most all the noticeable mechanisms of safety with an external dealer apply, but the cloud computing enlarges the problem, and also the fear. To address the security over the cloud, the data safety must change up the load, the similar way that Information technology value will be done. Information technology wants to the attention on the data layer safety, meanwhile the subordinate layers are outside its controlling. Corporations that twitch the change to the cloud would find where security is being strongly combined with their setup stack at the network layers primarily, to the socket where it converts hard to mocker infrastructure and security apart. However, by touching to the cloud, the well level of mechanism through the network will be lost, and the security at the upper layers should take over. That should go without any aphorism that cloud computing is motionless immature. As a result, corporations should evade putting the information which is in the cloud without having a facsimile elsewhere. Which is Just similar all the things else, stock in a possibility plan, plus testing the plan, is very critical. Impact on society: Cloud computing which will have the considerable impact on the step of economic progress. Cloud computing might possibly donate almost a million fresh jobs from the expansion of numerous hundred thousand minor businesses in the next years. Cloud might also offer leap fogging growth chances to emerging nations. Nevertheless, as with any disorder technology, there persist so many questions and doubts about the environment in which cloud will develop. Some are troubled about the likelihood of extended stays or problems in the expansion and deployment of cloud. Others are worried about the possible control of cross border privacy laws or other controlling limitations. A strong, multi investor dialogue to measure together areas of risk and promise. Nano technology: Nanotechnology makes use of materials of size less than 100 nanometers. In practical the width is about 1/800 of human hair and 1/70th of red blood cell diameter. The purpose of nanotechnology is to produce the materials in atomic scale. In coming decades nanotechnology brings revolutionary changes in computers in terms of speed, data storage. â€Å"Nanotechnology is the principle of atom manipulation atom by atom, through control of the structure of matter at the molecular level. It entails the ability to build molecular systems with atom by atom precision, yielding a variety of nanomachines† (Mick Wilson and et.al 2002 NANOTECHNOLOGY ) Characteristics of nanotechnology: The materials formed by nanotechnology exhibits different properties compared to conventional material. According to the arrangement of nano partials in a material, they exhibit different properties physically, chemically and biologically. In general, we cannot predict the material properties by physics and chemistry. Electricity laws which hold good for big materials may not work for nonmaterial. For example a material acts as a conductor at its normal size and it may act as insulator at nano sizes. Rapid Development: Nano technology is emerging rapidly in 21 century. It was not in use until the year 1959.a magazine of science named the year 2001 as â€Å"break through of the year†. At present nanotechnology is involved in hundreds of different applications. NSF(national science foundation )expected nano services and materials will have $1 trillion market in business by 2015. Many countries are depended on nano technology because of its ability to produce products in different areas using nano technologies. Applications: It has a wide range of application areas, which will help in increasing human life standards in developing countries. Some important nanotechnology applications are * Energy production, storage and energy conversion * Agriculture productivity * Construction * Food storage and processing * Health applications such as diagnosis disease * Water purification systems * Health monitoring * Vector and pest detection control * Drug delivery system * Air pollution control. Impacts of Nanotechnology on society Each technology has good and also adverse impacts on society. When coming to nano technology, it has potential to make revolutionary changes in people lives across the world. It helps in reducing global warming; Fuel consumption is decreased by the fuel additives and water purification system with greater efficiency. Military services use these technology for detecting enemies and producing advanced weapons. In negative, it act as a weapon for terrorism. Terrorists make use of nano technology to produce toxic weapons. In medical sciences, diagnosis disease can treated by this technology. If the growth of this technology fallows the same flow, in future computer think as a machine. The life span of human will be increased as a result of DNA repair, improved improved drugs and medicines. ( Mihail C.roco and William sims binbridge,2001) Impact of nanotechnology on business: Innovations of new technology and developments in existing technologies will affect the economy of the country. As because of its demand and applications in wide areas such as medicine, electronics, computers etc., all countries around the world investing massively in nanotechnology. * In 2006, the amount spent globally for research and development in nano technology reached $12.4 billion, which is 13% more than invested in 2005. * The amount spent by the governments of all nations in the world is about $6.4 billion for the year 2006 where as for the year 2005 is $5.9 million. From the year 2005 to 2006 the investment growth is 10%. * Established business organizations spent $5.3 billion for research and development on nanotechnology in 2006. The growth is 19% from the past year 2005. * As because of growth, the nanomarket is expected $1 trillion for the year 2015. Conclusions: The two emerging technologies namely cloud computing and nanotechnology is attracting the attention of the world by its rapid growth. In future cloud computing makes great changes in computer world. Internet and computer applications in future may be come simple than now. In coming decades we can expect revolutionary changes in the world which leads to nano size electronics instead of chips now we are using , medical nano applications increasing the lives of people. And it also shows impact on social life of human. References: Mihail C.roco and William sims binbridge,2001 NANO SCIENCE AND NANO TECHNOLOGY. Mick Wilson, et.al 2002 NANOTECHNOLOGIES Mark ratner, Daniel ratner ,NANOTECHNOLOGY Dr. james canton 1999, â€Å"The statagic impact of nano technologyon the future of business and economics.† http://www.mediaplanet.com/ http://www.lifeissues.net/writers/irvi/irvi_32biotechnology.html

The Name “Estella” in Great Expectations :: Great Expectations Essays

The Name â€Å"Estella† in Great Expectations    The name of the characters in a Dickens’ novel, Great Expectations, is very important. In the case of Estella, the name indicates her personality, her relation with other characters and even the way in which she moves along the novel.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   In Spanish, the word for star is â€Å"estrella†.   Since Spanish is a â€Å"romance† language, estrella is undoubtedly derived from the Latin word for star.   Stars are cold but beautiful to see. The same is true for Estella: she has a cold personality but she is very pretty. Estella was given to Miss Havisham at night - which is when stars appear. The first time Estella appears is in chapter 8, in the Pip’s first visit to Miss Havisham's house. The first impression Pip has about Estella is also characterized by ambiguity: he thinks she is pretty but she is proud. Miss Havisham obliges Estella to play cards with Pip. The first time that the card game appears the battle of sexes occurs since, after her frustrated marriage, Miss Havisham educates Estella to scorn men and in the card game Miss Havisham wants to see a victory of a woman over a man. Estella wins but the most important thing here is that Estella does no t want to play with Pip because she thinks he is common. This shows the pride and the superiority in which Estella is presented in her relation to Pip, and it's also important because, from this moment, Pip wants to be educated to be at the same level that Estella – he hopes that he can reach out and touch a star. Stella (without the first 'e') is the name of Sydney's beloved. Probably he gave his beloved this name because she was married in the real life and so, he could not reach her. Stars are far away and they cannot be reached. In the novel, Estella is presented as an impossible dream for Pip. In the same way Pip has expectations in a material level, Estella would be Pip's love expectation. In Christianity, the star is related to the Virgin Mary. Stars are also used for orientation, to guide us at night. In the novel, Estella appears as a light, it is Pip's orientation and he always has her in his mind.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   If we look at the sky we can see different kinds of stars.

Drop Out of School Essay

Today many young people do not realize the importance of an education so dropping out of school becomes an option. They just easily end up dropping from school without thinking about their future. They are thinking that their parents will support their financial daily lives, thus they do not feel worried about continuing their education. Moreover, there are several reasons that make young people decide to drop out of school some of which are getting poor grades, not getting along with teachers and/or students, or having a drug or alcohol problem. Those reasons make the young people end up by dropping from school. However, if the parent has been guiding their children well, they may be able to be solving the problem. There are no easy solutions to the school dropout problems. However, here are two ways to solve these problems; parents should encourage their children to do the right things and parent should meet with the school counselor. There are some solutions to the problem of dropping out of school. First, parents should encourage their children to do the right things, so that one day the children will become a better person and will be useful for the children’s future. For example, parents should talk with their children about how important the education is for their future; help them understand that the choices they make can seriously disrupt their future. The parent should not give up trying to make conversation with their children. Furthermore, the parent should start a conversation by asking their children how school is doing or make other conversation where both side feels comfortable with each other. In addition, by being open to one and another would give the children confident to talk about what they have been observed from school. This type of communication is sometimes hard to do but it is necessary to keep their children remain in school. Next, when a parent notices that their children want to drop out from school, the parents should follow this solution: workings with school counselors or teachers that can help their children remain in school. For instance, the parent may arrange for help by making up a schedule to meet the school counselor. The parent has to inform their children to meet with their school  counselor at least once a week to solve their children problems in the school. Especially, for children who has a problem in certain subjects which make them to think about dropping out of school. As an expert, the counselor will give advice to the young people by explaining how important education is for them on the future. Moreover, education is one of the requirements to get a better job, which they will later need for their future and for personal responsibilities. In conclusion there are many reasons why kids drop out of school. Primarily they have to do with a poor understanding of what good education is, struggling to make the grades, and due to drug problems. By maintaining good open communication with their children and seeking advices from school advisor which are preventing their children drop out from school. In the end, the parents and children can work together to keep the children remain in the school. Thus, by having good communication with their parents, teachers, or school advisor, it is important for children to realize that the adults in their lives do want them to remain in school and are willing to do a lot to make it possible. Hopefully, these tips might be helpful for parents who have problems with their children who want to drop out from school.

Advanced Audit Principles and Practice The WritePass Journal

Advanced Audit Principles and Practice Executive Summary Advanced Audit Principles and Practice Executive SummaryIntroductionOverview of Changes in Audit RegulationsReactions of Audit Firms to Regulatory ChangeEnron and Lehman – A ComparisonDetecting Fraud and ErrorsReporting on Business Going Concern Actions of Arthur Andersen and Ernst Young that could have Avoided Litigation ConclusionsReferencesRelated Executive Summary The recent financial crisis has led to a great deal of discussion about the role of the auditor and whether the increased regulations are now effective in reducing the chance of further difficulties of this type, in the future. By looking at the collapse of both Enron and Lehman Brothers, it can be argued that the ineffectiveness of the auditing profession and, in particular, the lack of independence between Arthur Anderson and Enron, were seen to be critical factors in the downfall of Enron. Bearing this in mind, there have been some fundamental changes to the auditing regulations, in order to rebuild investor confidence and also to ensure that there is much less chance of similar problems occurring, in the future. Introduction The failure of Enron in 2001 resulted in a dramatic shift in the approach to auditing, in the UK (Fazdly Ahmad, 2004). The collapse was largely due to the relationships between Enron and its auditors, where Enron was audited by Arthur Andersen LLP which was Enron’s main client.   Arthur Andersen provided substantial non-audit related services and worked attentively with the management to create procedures for suppressing the real figures for the financial statements. Questions that have arisen following the collapse of Enron and discussion were had over whether or not the auditing undertaken offered the level of certainty that is necessary for an effective economy (Alleyne Howard, 2005). Overview of Changes in Audit Regulations Following on from the collapse of Enron, the UK government established the Coordinating Group on Audit and Audit and Accounting Issues (CGAA) which comprises of high level groups of regulators and ministers looking at auditing. The matter was also deemed to be relevant in the US and, in 2002, legislation came into force in USA, where the Sarbanes-Oxley Act introduced, announcing changes to the regulation of financial practice and corporate governance. It contains 11 titles which aim to protect shareholders and stakeholders from creative accounting, fraud and embezzlement practices in US corporations. The act is monitored by the Securities and Exchange Commission (SEC), and places deadlines for compliance and publishes the rules’ requirements.   The aim of the Act is go through legislative audit requirements and to protect investors by advancing the accuracy and reliability of corporate disclosures. Nevertheless, it covers matters such as launching a public company, accountin g oversight board, audit independence, corporate responsibility and enhanced financial disclosure. The assumption of the Sarbanes-Oxley Act is that the regulations apply equally, as is makes no difference between US and overseas registrants. The CGAA in the UK was set up by the Chancellor of the Exchequer and the Secretary of State for Trade and Industry, and is made up of high level group of regulators and ministers with the authority for managing the review of the regulatory framework. The foremost matters included in the review are audit independence and making recommendations for change. It was noted at the outset that auditing is a vital part of the accounting framework which then sustains the capital markets and legitimises the financial statements.   The main concept is to reassure the shareholders and stakeholders that the corporation’s financial statements are true and fair. Furthermore, it will add credibility and reliability to the financial statements, meaning that an auditor should be competent and independent. As a result of this, the CGAA has made several significant changes in relation to the rotations of audit partners and key audit staff (Church and Zhang, 2006). There is no obligation for the UK listed companies to change auditors after a number of years in office. Nevertheless, where the same audit engagement partner acts for an audit client, for a protracted period of time, threats are likely to occur, as a result of familiarity (Hussey, 1999). Consequently, the UK regulatory obligations are that, for listed corporations, the audit engagement partner cannot perform for more than seven years and cannot return to that role for further five years. The International Federation of Accountants (IFAC) was also developed as regards to the Code of Ethics for Professional Accountants. This is principally in line with the present UK approach to audit independence, which is directing on the threats to audit independence and the safeguards. Furthermore, audit responsibilities have developed from looking at straight-forward error and giving true and fair audit opinion to the establishment of a value-added services for consumers and regulators; services consist of reporting on internal control deficiencies, identifying business risks and even providing guidance on these risks. Consequently, auditors are expected to be articulated in accounting and reporting standards and requirements, as well as in diverse areas varying from the technological to the legal aspects of business and finance. In this context, pressure on the audit function is increasing, due to audit related corporate failures and new regulations (Dunn, 1996). As part of the review and as a direct result of the collapse of Enron, the concept of auditor independence and the way in which providing non-auditing services impact on the level of independence came under particular scrutiny (IAS Plus 2002). As a result of this, five key areas have been looked at within the area of audit and review of the regulatory framework. This entailed, firstly, the need to increase transparency where disclosure is concerned; secondly, looking at all the potential threats to independent, auditing; thirdly, looking at issues associated with non-auditing services and how they should be managed; fourthly, looking at international variations, recognising that they could create difficulties in harmonisation if not achieved; and finally, the requirement to identify the role of the audit committee within these organisations. The regulatory framework in the UK was therefore developed in a much more robust manner, in order to ensure that the type of close-knit relationship experienced in Enron does not reappear and that organisations are placed under the appropriate level of scrutiny, in terms of their financial activities. This was also recognised to be important, not only from the point of view of achieving genuine independence and robustness within organisations, but also to increase consumer confidence. Moreover, in the current economic crisis, there are concerns that organisations might behave in an unscrupulous manner and therefore developing a regulatory framework which offers security to investors will be a critical part of the long-term recovery of the UK economy (Salter, 2008). Reactions of Audit Firms to Regulatory Change As a result of the changing regulatory structure, clear changes that have emerged within auditing firms, across the UK. Many of these changes have taken place in order to comply with the new regulatory standards. However, by identifying the way in which the auditing firms are changing their working procedure, it is possible to obtain a greater understanding of how influential the recent changes to the auditing practices in the UK have been on the economic recovery (Byrne, 2001). Substantial changes have happened in relation to the operation of auditing firms. The main change is that there is a greater requirement when it comes to auditor independence and this is seen as a crucial solution to the previous problems faced by auditing firms handling the management of an organisation. One of the main findings which emerged in Enron was the fact that the auditing firm Arthur Andersen and was so reliant on Enron for many of its projects and income, that it was not prepared to challenge the directors and was therefore highly unlikely to undertake a full and comprehensive audit. Regulatory changes have stepped in to prevent the amount of non-auditing services reaching such a high level that this type of independence is jeopardised (Collins, 2006). Another issue which has emerged from the regulatory changes is the fact that many auditing firms found themselves in financial difficulties. These firms, therefore, looked at ways of making the auditing process easier by standardising the approach and using common practices which would enable them to use checklists, in order to plan and record the auditing questions. Whilst this was an effective way of operating, in many cases, it did result in a lack of thoroughness. Furthermore, by increasing the level of regulation and the expectations that would emerge from a thorough audit, auditing firms have had to change the fundamental method of operation, to comply with these increased regulatory standards (ACCA, 2010). The regulations not only look at how each individual auditing firm operates but also look at the interaction between the auditing firms and institutions such as the Financial Services Authority, thus requiring a much higher level of interaction between the auditing firm and the large corporation and the FSA, to ensure greater scrutiny of particular accounting practices. The most notable change, however, when it comes to regulations is the replacement of Scheduled 2 of the Companies (Disclosure of Auditor Remuneration and Liability Limitation Agreements), which places a much greater reliance on disclosure relating to non-auditing services, so that issues relating to independence can be more transparently analysed. On the whole, however, it can be seen that auditing firms have looked towards changing their operations, both internally and externally. This is in recognition of the fact that, in order to achieve economic recovery, it is necessary for the public and investors to be able to trust the auditing profession to give a true and accurate reflection of the financial statements within a particular organisation. By recognising that the FSA has become much more involved in the interaction between auditing firms and the regulators, this has required auditing firms to become much more transparent in their operations, both as a result of regulatory changes, but also as a result of changing markets demands (Sukhraj, 2010). Further changes have been made as a result of the Companies Act 2006 which requires greater disclosure of financial statements and, in particular, areas such as the level of director remuneration and a more thorough statement from the auditors in relation to the contents of the financial statements. All of these changes have had a fundamental impact on the work of the modern day auditor. Enron and Lehman – A Comparison Enron and Lehman Brothers proved that corporate governance is vital to successful business and social welfare and after Enron filed for Chapter 11 bankruptcy, in 2001, further evidence appeared of corporate governance weaknesses and fraudulent activities. It is recognised that shareholders and stakeholders can be corrupted by a firm’s status and success; however, according to economic and finance theory, this should not happen due to them being rational economical agents. A serve lack of transparency in Enron’s balance sheets meant that no one was aware of this and other off-balance-sheet liabilities, until it was too late (The Economist, 1 November 2001). The main accusation covered fraud and material misstatement in the company’s financial reports. Even though Enron’s annual reports indicated financial prosperity, it was clear that Enron’s management knew a lot more than it was letting on (Kroger, 2004). Ultimately, the fundamental reason behind t he collapse of Enron was on account of deceiving financial statements, as they modified the data to show a successful performance. Enron was audited by Arthur Andersen, for over 20 years, and it was responsible for verifying that the financial statements were true and fair, as well as providing credibility and assurance for the shareholders and stakeholders (Fusaro and Miller, 2002). Although lack of audit independence was considered to have an impact on the collapse of both Enron and Andersen, the latter also provided internal, external and consulting services, where 70 % of the work was non-audit related. Previous Andersen staff had worked for Enron, as well, and the relationship between the consumer and auditor was too informal. There was no audit rotation, because Anderson had been working with the same client, for over 20 years, this familiarity was a particular threat to their independence. It was also argued that this would increase the level of self-interest threats. Arthur Andersen provided internal audit services to Enron, as well as external; therefore, this influenced the audit independence and integrity, as the duties of the external auditor are to review the internal auditor’s work and form an opinion, and based on that, Andersen refused to acknowledge the fraud and manipulation, while giving a true and fair review (McLean and Elkind, 2003). Lehman Brothers had fragile corporate governance arrangements which failed to safeguard it against even moderate risk taking and this was seen to be central to the collapse (Porter et. Al. 1996). The fundamental reason for the failure was the misconduct of the audit firm which was Ernst Young and the work of the board in conjunction with the auditors. The similarities between the collapse of Enron and the collapse of Lehman Brothers could be seen in the areas of audit risk and auditors giving incorrect audit reports.   Lehman Brothers filed for many reasons, corporate governance failures were the most important, especially risk management. Lehman Brothers failure and other failures that happened in the financial crisis will, in turn, spawn a new wave of corporate governance (Greer Tonge, 2006). Detecting Fraud and Errors A key question which has emerged from both the collapse of Enron and Lehman is to expand the role of the auditor when it comes to detecting fraud, within the organisation. Investors may well believe that the auditors should in fact be in a position where they are required to investigate and identify any potential, fraud that may exist within the financial position of a particular company; however, the matter is not so clear when specific auditing requirements are looked at (Cosserat 2004). This distinction can be seen as the expectation gap which exists between what the public and investors believe that the auditors are doing and what they are actually required to do. ISA 240 which looks at the auditors’ responsibility to consider fraud in the audit of financial statements clearly indicates that it is the responsibility of the management team to deal with issues relating to fraud, by establishing control systems within the internal accounting processes that would detect fraud (HM Treasury, 2010). The auditor simply has the role of establishing that no material level of fraud has been omitted from the financial statements and is not responsible for the prevention of fraud, in the first place, but rather insuring that any instances of fraud are accurately reported to the public. This simple distinction is particularly important when it comes to public perceptions, and although auditing practices are seen to be linked to the collapse of Enron and Lehman Bros, the r eality is that the management teams need to take an increased level of responsibility and it cannot simply be said that the auditors failed in their duty. Reporting on Business Going Concern As noted in previous sections of this report, an audit report on financial statement does not necessarily provide a full and frank disclosure of the position of the organisation. However, the precise role of the auditors has been somewhat muddied and one particular criticism which has emerged following the high-profile collapse of Enron and that of Lehman Bros was the lack of going concern opinion being presented by Arthur Andersen when auditing Enron for the last time (Porter, 1997). Regulatory changes now require auditors to â€Å"perform audit procedures designed to obtain sufficient appropriate audit evidence that the event at the date of the auditors report that may require adjustment of, or disclosure in, the financial statements have been identified† (Auditing Practices Board, 2004, p. 3). This discussion of going concern reporting can therefore be seen to be inherently important to the role of the auditor when identifying a threat to the solvency of a company. The role of the auditor is to identify that the financial statements have been prepared in a way that involves consistently applying accounting policies and that any judgements made as a result of management understanding has been done in a reasonable and prudent manner. It does not require a statement as to whether or not the business is likely to remain solvent over a prolonged period of time and a lack of going concern statements presented on behalf of Enron was potentially a real negative, in terms of the role of the auditors in this large organisation (Swartz and Watkins, 2004). In the case of Enron, it could be argued that the collapse of the organisation was as a result of poor managerial decisions and not necessarily as a result of fraud and error and therefore it is questionable whether the auditors would have a role in identifying the underlying problem. Despite this, there is a strong argument to suggest that had the auditors been required to give a going concern statement, it may have been possible that the investors were alerted to the problems within Enron, at a much earlier date (Venuti et. al 2002). Actions of Arthur Andersen and Ernst Young that could have Avoided Litigation Both auditing companies suffered substantial problems as a result of the collapse of Enron and Lehman Bros. In the case of Arthur Andersen, its role in failing to identify the problems within Enron could have been seen as fundamental to its ultimate collapse, with Ernst Young being charged for professional negligence, as a result of its role in the Lehman collapse (Ruddock et. Al 2004). This presents a potentially difficult situation for auditing companies and the discussion of what Arthur Andersen and Ernst Young could have done differently has been the subject of much recent debate. Conclusions One particularly obvious issue that has arisen during the analysis of how Enron failed is the fact that its auditor, Arthur Andersen, gained a large amount of revenue from Enron in relation to non-auditing services. Therefore, by allowing itself to become so reliant on Enron, Arthur Andersen put its auditing team in such a situation that it was unlikely to be able to undertake its activities with sufficient independence. The individual auditors themselves were, therefore, under an almost impossible level of pressure to keep the directors of Enron happy and also to ensure that they used their subjective abilities, so as to maintain the strength of relationships between the entities (Vanasco et al 1997). Similar problems were seen to be present regarding Ernst Young, and its relationship with Lehman Bros. Although the collapse of Lehman Brothers did not destroy Ernst Young, it certainly had a negative impact, with Ernst Young having to fight its corner in the US Supreme Court. 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