Top audit firms push to use their own judgment

Auditors and corporate finance departments must be able to use professional judgment without being second-guessed if countries continue to adopt principle-based accounting standards, the chief executives of the top six global accounting networks argued in a white paper on Tuesday.

The paper, presented at a Global Public Policy Symposium in New York, urged regulators and other stakeholders to create a system where reasonable auditor judgments are accepted.

"Investors are best served when financial reports are clear and easy to understand and use," the CEOs of Deloitte Touche Tohmatsu [DLTE.UL], Ernst & Young [ERNY.UL], PricewaterhouseCoopers [PWC.UL], KPMG [KPMG.UL], Grant Thornton, and BDO Seidman wrote.

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Learning Curve Theory

Learning Curve Theory is concerned with the idea that when a new job, process or activity commences for the first time it is likely that the workforce involved will not achieve maximum efficiency immediately. Repetition of the task is likely to make the people more confident and knowledgeable and will eventually result in a more efficient and rapid operation. Eventually the learning process will stop after continually repeating the job. As a consequence the time to complete a task will initially decline and then stabilise once efficient working is achieved. The cumulative average time per unit is assumed to decrease by a constant percentage every time that output doubles. Cumulative average time refers to the average time per unit for all units produced so far, from and including the first one made.

Major areas within management accounting where learning curve theory is likely to have consequences and suggest potential limitations of this theory.

Areas of consequence:
A Standard Costing …

Resistence to Change - Approaches of Kotter and Schlesinger

The Six (6) Change Approaches of Kotter and Schlesinger is a model to prevent, decrease or minimize resistance to change in organizations.
According to Kotter and Schlesinger (1979), there are four reasons that certain people are resisting change: Parochial self-interest (some people are concerned with the implication of the change for themselves ad how it may effect their own interests, rather than considering the effects for the success of the business)Misunderstanding(communication problems; inadequate information)Low tolerance to change (certain people are very keen on security and stability in their work)Different assessments of the situation (some employees may disagree on the reasons for the change and on the advantages and disadvantages of the change process) Kotter and Schlesinger set out the following six (6) change approaches to deal with this resistance to change: Education and Communication - Where there is a lack…

Poll : Does CIMA, UK qualification add value

Poll : Does pursuing CIMA, UK qualification add value to a member of ICWAI, India ? Vote on the poll and share your thoughts by commenting the blog.

Poll: Vote here

I feel that if you are a member of ICWAI and you pursue CIMA, UK qualification, you are not adding any value to your skills since you will be learning the same. Once you are qualified, you are still a Cost & Management Accountant but from UK. For an employer, I would still have same skills and training on Management Accounting.

However if you pursue qualification like Company Secretary or CPA or ACCA, your skills are enhanced with the knowledge gained during training and passing of exams. After qualification, you are bound to follow the CPD programs of ICWAI and other institute. In competitive world, employer look for people with multiple skills.

Which one promotes you as professional better against your name:
AICWA, ACMA
or AICWA, ACS
or AICWA, CPA
or AICWA, ACCA

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Santosh Puthran

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