...by gift, bequest, devise, or inheritance. However, a gift cannot be from an employer to an employee. Here, Ariel Asher (“AA”) was paid $1,000 a year for the 10 years that she was with the firm. The firm characterized the $10,000 payment as a “severance.” AA will argue that the amount was a gift, thus not taxable. The IRS will argue that § 61 includes severance pay in the language itself. Additionally, § 1.61 states that a gift cannot be from AA’s employer. Therefore, the severance pay will be included in gross income. Purchasing bargained work equipment income? In Pellar, the court established that bargain purchases generally do not constitute gross income. If property is transferred as compensation for services in the amount less than its fair market value, the difference between the fair market value and the amount paid is gross income. Here, the firm was downsizing and had excess furniture and invited only departing members to make an offer. The firm accepted AA’s offer of $1,700 for the furniture (FMV $4,800). AA received a discount/saving of $3,100 from the FMV. AA will argue that a bargain purchase does not constitute gross income. However, the IRS will argue that since the furniture sale was only accessible the employees leaving the firm, the discount received was part of the termination/severance package, thus the difference between FMV and what AA paid ($3,100) will be included in gross income....
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...association which serves its members mainly in roadside recovery services and providing other services(“About AA”, 2008, para 2)2. 2. Evaluate The Opportunities, Threats, Strengths And Weaknesses Of The Organisations Using Strategic Models In order to analyse the two significantly different organisations, an evaluation on their external & internal environments was made using various strategic models to compare and contrast their opportunities and threats they face, as well as their strengths and weaknesses. 2.1 An Organization's External Environment (Coulter, 2013)3 2.1.1 General Environment The general environment, according to Coulter (2013)3, includes economic, demographic, socio-cultural, political-legal and technological sectors. Each of these aspects is evaluated to determine if an opportunity or threat is posed to CapitaLand and AA Singapore. An Organization's External Environment (Coulter, 2013) 3 a. Economic The growing affluence of both the Singapore and China market, which boast a large number of millionaires (Hannah Goldberg, 2014)4&(Neerja Jetley,2013)5, is an opportunity to CapitaLand. Besides that, the global economy has been in a very low interest rate environment. Singapore’s SIBOR has been below 1% since 2008 (Source: http://www.siborratesingapore.com/). This is a boost to CapitaLand, as the buyer can afford to loan more money to purchase more...
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...Current Ethical Issue in Business Kathryn Sumner PHL/323 November 30, 2015 Chuck Thompson Current Ethical Issue in Business Enron had one of the biggest ethical scandals of the 21st century. The company’s unethical practices was the downfall of the company. Let’s start with a little bit of history about the company. Enron was formed by the merging of two different companies, Houston Natural Gas and InterNorth in 1985. Kenneth Lay was the chairman and Chief Executive Officer of Enron. Lay hired Jeffery Skilling and he developed a staff of executives who used accounting loopholes, special purpose entities, and poor financial reporting to hide billions of dollars in debt from deals and projects that failed (Biography.com, 2015). The impact to the company is very detailed and will be discussed throughout this paper. At first Enron was not financially stable for many years but it was able to survive. After the deregulation of electrical power markets in 1988 Enron quickly became a thriving company subsequently it went from an energy delivery to energy broker. With deregulation this allowed Enron to profit from the exchange and generating income from buying and selling companies. Over time the contracts became more diverse and more multifaceted. Enron’s services evolved and so did the culture of the company (Sims & Brinkmann, 2003). Skilling pushed more aggressively and he made Enron one of the biggest wholesaler of gas and electricity. They made $27 billion dollars in...
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...Statement Analysis American Airlines (AMR) Abstract American Airlines (AAs), American Eagle, and American Connection currently provide scheduled service to 250 cities in 40 countries, with an average of over 3,400 daily flights. Together, these carriers operate a fleet of over 700 aircraft and are subsidiaries of the AMR Corporation. Though AMR was founded in 1982, the AAs brand has been a major player in air travel for over three quarters of a century (www.AA.com.). The AMR mission statement is: "Setting the industry standard for safety and security; providing world-class customer service; creating an open and participative work environment which seeks positive changes, rewards innovation and provides growth, security and opportunity to all employees; and providing consistently superior financial returns for shareholders." (www.AA.com). An article written by Gaby Logan from USA Today stated: “Despite this government-funded measure, several prominent AAs declared bankruptcy not long after the 9/11 attacks, included US Airways and United Airlines.” As a result of the massive financial losses due to lack of passenger demand, canceled flights and increased expenditures for security, even airlines that did not have prior financial issues were forced to renegotiate labor contracts and lay off high numbers of employees, such as the 7,000 employees laid off by AA.”(Gaby Logan, USA Today article published Nov 2009). US Airways, Delta Airlines and Southwest Airlines...
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...categories are business environment, strategy, and organizational architecture. Business environment of Andersen includes technology that was used effectively; structure of its markets, regulations which helped Andersen to grow along with its reputation. The second category is strategy which includes Andersen’s primary goals, choice of business, and services. Finally, the last category is organizational architecture which explains how authority is distributed among Andersen’s employees, and how rewards determined. BUSINESS ENVIRONMENT TECHNOLOGY | MARKETS | REGULATIONS | Company started using computers for bookkeeping.Company developed the largest technology practice. | Arthur Andersen was well respected, reputable auditing company for many customers.Early 1950s Andersen entered in computer consulting business. | The federal law in 1930’s which required companies to provide their financial statements to an independent auditor each year helped Andersen’s grow. | STRATEGY Quality audits were valued more than higher short-run firm profits.“Four cornerstones” of good service, quality audits, well managed staff and profits.Auditors were rewarded and promoted for making sound audit decisions. Mid-level partner was making average $160,000 in today’s currency.In 1990s AA formulated a new strategy that focused on generating new business and cutting costs. It included how partners should empathize with clients. | ORANIZATIONAL ARCHITECTURE AA’s both business (auditing and...
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...• Within a few years AA moved from one of the largest professional service organizations in the world to almost a complete collapse. • The business environment and strategy changed in many ways. Management team responded by making changes in their organizational architecture through decision rights, performance evaluation, and reward systems. • (Poorly designed organizational architectures can result in poor performance and even a company failure) • If Arthur Anderson had gone back to their roots of utilizing sound audit opinions like they did in the event of a demanding railroad company… • AA promoted its four cornerstones of good service, quality audits, well-managed staff, and profits for the firm. • Auditors were rewarded and promoted for making sound audit decisions. Top management assigned significant decision rights to the central office’s Professional Standards Group. This group consisted of internal experts and monitored audits and issued opinions on how specific types of transactions should be handled. • This structure was used to promote consistent and well-reasoned opinions for the firm. • AA launched their computer consulting business. The demands for information technology help rapidly expand the business and the revenues soon surpassed the auditing business in the mid 1980s. • The traditional accounting business was growing slowly due to increased competition and a large number of merges in the 1990s, auditing was quickly becoming a low margin...
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...healthcare sector, where AA operates, is highly intervened and regulated Governmental price capping renders a pricing strategy based on Bouwman's model innefective. The PESTLE analysis points to several, sometimes concurring, threats from the outside. The SWOT analysis pointed to the need to redefine our mission as business. AA has gradually shifted from a clinical services company to a consultancy services company. Background information Anesthesia Associates Care (AA) operates in the Dutch medical sector, and it was first established in 2000 as an anesthesiology freelance practice in the city of Rotterdam. Although the author of this report works three to five days per week as a clinician, his function in AA also includes quality management and strategy. The Dutch medical sector where AA operates is highly intervened and regulated. The financing of hospitals and medical services is done by an oligopoly of insurance companies. The government, under advice from the insurers, imposes capped hourly wages for anesthesia services. Non-compliance with the price limitation is a criminal offence. Between 2002 and 2007 the demand for anesthesia locum tenens was so high that AA expanded to eighteen anesthesiologists and nine nurse anesthetists, while it expanded from Rotterdam to all corners of the Netherlands. Today, our client portfolio includes sixty-one Dutch university, tertiary, secondary and primary level hospitals. AA enjoyed a monopoly from...
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...Business Plan Business Overview The ventilation and air conditioning (VAC) industry deals in system, ventilation, and air – conditioning of buildings .The ventilation, and air-conditioning are interconnected, as it provides livable temperature in an indoor facility within reasonable installation, operation, and maintenance costs. Basically, VAC systems is designed to provide ventilation, reduce air infiltration, and maintain pressure relationships between spaces. The ventilation and air conditioning (VAC) industry is indeed a very large industry that covers operation and maintenance, system design and construction, equipment manufacturing and sales. Going forward, the demand for ventilation and air conditioning (VAC) services is projected to increase as the growth in the real estate industry and the decrease in the electricity tariffs in the recent past will definitely translate to growth in the ventilation and air conditioning (VAC) industry. The Air-Conditioning Contractors industry is not dominated by any company. As a matter of fact, no company can boast of having more than 5.0% of the total annual revenue in the industry. The major players in the ventilation and air conditioning (VAC) industry are .0smaller firms that specialize in kinds of VAC systems or dominates a certain location. The ventilation and air conditioning (VAC) industry is indeed a very large industry and pretty much thriving in all the parts of the world especially in developed countries such as United...
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...2009, p. 285). By November 2001, the company’s stock, which once peaked at $90 US, was down to less than $1 US. It was a disaster for the thousands of employees and investors (Skilling v. United States, 2010). Employees lost their jobs and pensions, and investors lost billions of dollars. The Enron scandal is one that left a deep and ugly scar on the face of modern business. In this article, the facts of Enron’s case were reviewed and the major ethical issues involved in Enron’s scandal were analyzed. The rest of the paper is organized as follows. The second part is a brief summary of what has happened in Enron. The third part described the role of Arthur Andersen (AA) in the Enron scandal. In the following parts the culture of Enron, the important people involved in this case, and also the major ethical issues about this scandal were analyzed. At last, the conclusion part discussed what we should do to avoid another Enron. 1. 2. Statements of Facts 2.1. A Brief History of Enron Since found in 1985 as an interstate pipeline company, Enron had been a power supplier to utilities. Its business began through the merger of Houston Natural Gas and Omaha-based InterNorth. In the following 20 years, Ernon grew quickly and became the largest...
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...loyalty of present and potential customers and has successfully established its image in both the corporate and the commercial world, which has resulted with achieving 10% - 15% of the domestic market share in the aviation industry of South Africa. Philosophy Kulula.com’s committed philosophy of ‘Now anyone can fly in South Africa’ to achieve its goals and objectives and ensure uncompromising standards of safety, comfort, reliability & service to its valued Customer & partners. PESTEL (International, Demographical) Analysis As airline industry is a large and growing industry, “PESTEL Framework Analysis” offers the analysis of political, economic, social and technological, issues that affects the strategic development of Kulula.com’s business and also identifies the influences of external environment and legal factors in which Kulula.com operates. Upon analyzing, results obtained can then be used to take advantage of opportunities and to make contingency plans for threats when...
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...INTERNSHIP REPORT ON “MONEY LAUNDERING AND ITS PREVENTION POLICY: A CASE OF CITY BANK LIMITED” Submitted To: Mr.Shawkat Kamal Assistant Professor & Program Coordinator, Executive MBA BRAC Business School, BRAC University Submitted By Tarek Amin Chowdhhury ID: 08104130 Department of Business Administration BRAC Business School, BRAC University Date of Submission: 22nd April, 2012 INTERNSHIP REPORT ON “MONEY LAUNDERING AND ITS PREVENTION POLICY: A CASE OF CITY BANK LIMITED” Table of Contents Letter of transmittal ............................................................................................................... i) Acknowledgement ................................................................................................................ ii) Executive Summary ............................................................................................................ iii) Acronyms ............................................................................................................................ iv) Chapter 1 ..................................................................................................................................1 Introduction of the report ........................................................................................................1 1.1 Origin of the report ...........................................................................................................2 1.2 Objective of the report ......
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...The business risk of BBBY can be categorized as medium to low. On the low side that is due to the fact that BBBY is a common goods company and the risk of default in the common goods industry is relatively low. But BBBY also has a lot of competitors with a higher market share and some of them even offer a higher ROE, like Best Buy (23.4%) and William Sonoma’s just a little above BBBY’s (19.5%), compared to BBBY ROE of 20.1%. The main competitors are chains of superstores such as Target and Best Buy. While BBBY has no debt on its balance sheets due to the conservatism of its management team, it invested a lot of its money in short-term securities and lately these investments weren’t profitable enough due to the low interest earned. Therefore, it is clear that the company needs a new strategy as to the future of their excess funds. As mentioned above, we believe that the company does have a lot of excess cash that needs to be organized in a better way to provide its owners with a higher return. The company could pay out the excess cash as one time dividend or it could implement stock repurchasing. As for the first alternative, it is highly inefficient because if the company offers higher ROE than the current market does, it should keep the money in the company. Companies always do what is best for their shareholders. Therefore, it leaves us with only one option – to repurchase some of the shares back from the public to increase the price of the stock that will remain outstanding...
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...the most respected, Arthur Andersen LLP (AA) has disappeared. The Big 5 accounting firms are now the Big 4. Why did this happen? How did it happen? What are the lessons to be learned? Arthur Andersen, a twenty-eight-year-old Northwestern University accounting professor, co-founded the firm in 1913. Tales of his integrity are legendary, and the culture of the firm was very much in his image. For example, “Just months after [Andersen] set up shop in Chicago, the president of a local railroad insisted that he approve a transaction that would have inflated earnings. Andersen told the executive there was “not enough money in the City of Chicago” to make him do it.”1 In 1954, consulting services began with the installation of the first mainframe computer at General Electric to automate its payroll systems. By 1978, AA became the largest professional services firm in the world with revenues of $546 million, and by 1984 consulting brought in more profit than auditing. In 1989, the consulting operation, wanting more control and a larger share of profit, became a separate part of a Swiss partnership from the audit operation. In 2000, following an arbitrator’s ruling that a break fee of $1 billion be paid, Andersen Consulting split completely and changed its name to Accenture. AA, the audit practice, continued to offer a limited set of related services, such as tax advice.2 Changing Personalities and Culture Throughout most of its history, AA stood for integrity and technical competence...
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...Wells Fargo Group Marketing 304 Professor Kiesler 2:00 P.M. – 3:15 P.M. T/Th 9 May 2007 [pic][pic] Wells Fargo: Marketing Plan Kevin De Place Bill Ho Ryan Neal Diana Suranyi Kevin Yetter Executive Summary Our team constructed a marketing plan of the company Wells Fargo. The first half of the report covers the company background by finding information about it, its competition, and the environment to see how the company stands. The second half of the report deals with a new product, tax preparation, and how it will be implemented into Wells Fargo. When analyzing the company, we found that it is viewed as the largest bank in the United States by physical size. The company have “2000” child companies and their advertising style is very recognizable with the stagecoach theme. The biggest competition to Wells Fargo is Bank of America. There are many trends that are looked at that could affect the banking industry. Some trends include the environment, government policies, technology, and much more. These trends show how the industry should view what is going on in the market that could affect how consumer’s perceptions are changing in the market. After the trends were analyzed, our team analyzed the customers and put them into segments. These segments are relevant because of the different ways that consumers look at the bank industry. The segments were then used to make the target market...
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...CASE: Connecting within Oneworld Following 2010 approval by U.S. and Japanese authorities for antitrust immunity, American Airlines (AA) and Japan Airlines (JAL) began sharing routes in 2011 that connect mainland North America with East Asia through a nonequity joint venture. Flights between Honolulu and Japan are not included in the agreement. This joint venture is similar to one forged among AA, British Airways, and Iberia for trans-Atlantic travel that began operating in 2010. In both cases, the agreements allow representatives from each airline to jointly manage capacity, sell and promote space on flights operated by each other, divide revenues, and schedule connecting flights. The major thrusts for these ventures are to cut operating costs by better controlling capacity, avoid disruptive price competition among them, and schedule so that there are more and better departure times and connections for passengers. The proposals are merely extensions to a historical series of alliances linking international airlines. In fact, the airline industry is unique in that its need to form collaborative arrangements has been important almost from the start of international air travel because of regulatory, cost, and competitive factors. In recent years, this need has accelerated because of airlines’ difficult profit performance. In effect, the airlines have been squeezed. First, costs have been rising, particularly because of oil prices and the requirement for greater...
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