...purchased from its stores as well as from other retail or online outlets. The Company's reputation for large attractive stores, technical assistance for product selection, and expert installation and repair services has enabled it to achieve double-digit growth in revenues and a number of stores over the last several years. In 1999, SE launched an e-commerce site that sells a full range of the Company's products. Performance Compared to other firms in the specialty retailing industry, SE has demonstrated above-average growth in sales and gross margins in the last decade. The Company's management is optimistic that this trend will continue for the foreseeable future. In fiscal 2008, SE reported the highest comparable stores' sales growthin the specialty electronics industry. However, preliminary results for fiscal year 2008 (ending on February 28, 2009) indicate that the Company might not be able to meet...
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...The Greek Crisis: Causes and Consequences Antonio Garcia Pascual Piero Ghezzi CESIFO WORKING PAPER NO. 3663 CATEGORY 6: FISCAL POLICY, MACROECONOMICS AND GROWTH NOVEMBER 2011 An electronic version of the paper may be downloaded • from the SSRN website: www.SSRN.com • from the RePEc website: www.RePEc.org • from the CESifo website: www.CESifo-group.org/wp T T CESifo Working Paper No. 3663 The Greek Crisis: Causes and Consequences Abstract Greece has reached a point where, under any plausible macroeconomic scenario, public debt will continue growing faster than GDP. Fiscal consolidation alone cannot close the solvency gap. A substantial reduction in the stock of debt is needed. Even post-debt restructuring, there is no guarantee that the government will succeed in its dual goal of restoring fiscal solvency and closing the competitiveness gap. Yet we think Greece stands a better chance of accomplishing these goals from inside the EMU rather than outside it. This chapter takes stock of the factors that led to the explosion of public debt, the loss of competitiveness, and the failure of the first EU-IMF programme. We also present our views on the likely debt restructuring (and post-restructuring) scenarios. JEL-Code: E600, F400. Antonio Garcia Pascual Economic Research Barclays Capital 5 The North Colonnade Canary Wharf E14 4BB, London United Kingdom Antonio.GarciaPascual@barcap.com Piero Ghezzi Economic Research Barclays Capital 5 The North Colonnade Canary...
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...ISSUES IN ACCOUNTING EDUCATION Vol. 27, No. 2 2012 pp. 461–474 American Accounting Association DOI: 10.2308/iace-50005 Super Electronics, Inc.: Financial Reporting of Sales Incentives and Vendor Allowances Using FASB Codification Mahendra R. Gujarathi ABSTRACT: Super Electronics, Inc., a specialty retailer, has recently initiated several sales incentives and has entered into a long-term purchase arrangement with a major vendor that entitles it to sliding discounts based on its level of purchases. Using FASB Accounting Standards Codification, you are to determine whether the Company’s existing policies comply with Generally Accepted Accounting Principles (GAAP). You are also required to evaluate the soundness of the proposals that SE’s management has made during the process of annual audit and explore plausible motivations behind them. The case provides an opportunity to examine several technical and conceptual accounting issues in a real-world setting, strengthen accounting research capabilities, understand implications of the choice of an accounting policy for performance measurement and financial statement analysis, and develop advanced critical thinking and professional judgment skills. Keywords: FASB codification; vendor allowances; customer loyalty programs; membership fees; price protection plans. CASE Company Overview uper Electronics, Inc. (SE or the Company) is a regional specialty retailer of consumer electronics, home office products, entertainment software, appliances...
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...REPUBLIC ACT NO. 7160 AN ACT PROVIDING FOR A LOCAL GOVERNMENT CODE OF 1991 Table of Contents BOOK II LOCAL TAXATION AND FISCAL MATTERS TITLE FIVE LOCAL FISCAL ADMINISTRATION CHAPTER 1 GENERAL PROVISIONS SEC. 304. Scope. – This Title shall govern the conduct and management of financial affairs, transactions, and operations of provinces, cities, municipalities, and barangays. SEC. 305. Fundamental Principles. – The financial affairs, transactions, and operations of local government units shall be governed by the following fundamental principles: (a) No money shall be paid out of the local treasury except in pursuance of an appropriations ordinance or law; (b) Local government funds and monies shall be spent solely for public purposes; (c) Local revenue is generated only from sources expressly authorized by law or ordinance, and collection thereof shall at all times be acknowledged properly; (d) All monies officially received by a local government officer in any capacity or on any occasion shall be accounted for as local funds, unless otherwise provided by law; (e) Trust funds in the local treasury shall not be paid out except in fulfillment of the purpose for which the trust was created or the funds received; (f) Every officer of the local government unit whose duties permit or require the possession or custody of local funds shall be properly bonded, and such officer shall be accountable and responsible for said funds and for the safekeeping...
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...government is a summary or plan of the intended revenues and expenditures of that government. Budget Preparation A full understanding of the budget planning and preparation system is essential, not just to derive expenditure projections but to be able to advise policymakers on the feasibility and desirability of specific budget proposals, from a macroeconomic or microeconomic perspective. It is much easier to control government expenditures at the "upstream" point of budget preparation than later during the execution of the budget. Thus, fiscal economists and general budget advisors need to know: * what is the framework in which budget decisions are made; * who is responsible for planning and preparing the budget; * what are the basic steps; * what are the typical weaknesses in procedures and how can these be overcome; and * how can changes in budget plans be programmed and targeted? Answers to these questions are set out in the subsections below. Budget planning and preparation are (or should be) at the heart of good public expenditure management. To be fully effective, public expenditure management systems require four forms of fiscal and financial discipline: 1. control of aggregate expenditure to ensure affordability; that is, consistency with the macroeconomic constraints; 2. effective means for achieving a resource allocation that reflects expenditure policy priorities; 3. efficient delivery of public services...
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...Tax IFRS Readiness Series The uncertain future of LIFO* The uncertain future of LIFO This paper was authored by Christine Turgeon, a partner; Scott Rabinowitz, a director; Helen Poplock, a director; and Sean Pheils, a senior associate with PricewaterhouseCoopers’ Washington National Tax Services (WNTS) practice. For over 70 years, US taxpayers have been able to value the cost of their inventories using the last-in, first-out inventory method of accounting (LIFO). In general, to use LIFO for federal income tax purposes, taxpayers must also use LIFO for financial reporting purposes (herein referred to as the LIFO conformity requirement). The use of LIFO for financial reporting purposes is not permitted under International Financial Reporting Standards as promulgated by the International Accounting Standards Board (IFRS). As a result, a conversion from US generally accepted accounting principles (GAAP) to IFRS likely will eliminate a taxpayer’s ability to use LIFO for federal income tax purposes. Moreover, the fact that LIFO is not permissible under IFRS has led many policymakers to debate whether LIFO should be permitted for tax purposes, irrespective of IFRS conversion. As a result, Congress and the Obama Administration are considering a repeal of LIFO, while taxpayers and practitioners are defending the merits of LIFO as sound tax policy and are seeking an administrative exception to the LIFO conformity requirement. The transition from LIFO to an alternate inventory...
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...payments are guaranteed by law, the government having the money or not, thus it is inappropriate to discount them at a high rate. People depend on this money for their future. The high discounts rates let politicians off the hook by lowering today’s payment on behalf of tomorrow’s retirees which is easy to do when you are not suffering currently, and the expectations of the future can be mislead and perceived highly than it should. America’s public pension crisis has arrived. A large number of municipalities, counties and states are experiencing severe fiscal stress. Some, like Detroit, have had to declare bankruptcy. At the end of 2013, Judge Steven Rhode’s ruled that Detroit may reduce pensions under Chapter 9 bankruptcy because they can no longer afford to pay benefits as it’s promised. Detroit’s unfunded pension liabilities are immense at $9 billion on a guaranteed to paid basis. The proposal plan of adjustment seems to be an insult for...
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...2010 You Decide 14 August 2010 The deep recession that we have found ourselves experiencing in this example doesn’t deviate far from our current economic situation as we stand as a nation today. With economic analysts predicting that recessionary conditions may persist for at least another year, the economy requires some government intervention to put it back on track. With prices falling and unemployment rising, a combination of both monetary and fiscal policy will be needed in order to bring the nation out of this severe recession. Prices are falling, with the inflationary rate at -2.4%, making it evident that both businesses and individuals are not spending and overall aggregate demand (AD) is falling. The Economic Consultant to the President, Mr. Raymond Burke, has recommended that the President lower interest rates to further help businesses and consumers “get back on their feet.” There are some inaccuracies in what Mr. Burke is recommending. The President has neither the ability nor the authority to make adjustments to interest rates. The Federal Reserve (the Fed) is responsible for the discount rate and for setting the reserve requirements. I do not agree with Ms. Patricia Lopez’s (Consultant to the Federal Reserve) recommendation to leave interest rates alone, sell bonds and raise the bank reserve. Raising the bank reserve will discourage banks from lending, which prevents businesses from expanding operations or from consumers from obtaining loans to purchase goods...
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...economy takes priority in his agenda. Furthermore, it will help to look into which administrative agency deals with the states of Florida’s economy policy; as well as understanding the effectiveness of the policy implementation, the resources that are being applied to the implementation, and what could be done for the improvement of the policy. Considering the state of the economy, it is without question that the State of Florida’s economy is an issue of great importance for Governor Rick Scott. As one of the states’ planning to reject Obamacare’s Medicaid expansion program, the Florida Center for Fiscal and Economic Policy along with the governor’s office will have to find other alternatives within the fiscal budget to help those without health care. Economic policy has always played a key role in the government. According to Gre Mellow (2013), The Governor’s 2013-14 budget proposal has some serious shortcomings, however. Not only does it include at least $185 million ($57 million GR) in cuts to crucial HHS program and services, of perhaps even greater significance is what is not included, namely any indication of an intent to expand the Medicaid program to cover almost a million uninsured Florida adults under the Affordable Care Act (para. 1). At...
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...could be important to program funding and success. In the PPBE process, the Secretary of Defense establishes policies, strategy, and prioritized goals for the Department, which are subsequently used to guide resource allocation decisions that balance the guidance with fiscal constraints. The PPBE process consists of four distinct but overlapping phases: Planning. The planning phase of PPBE is a collaborative effort by the Office of the Secretary of Defense and the Joint Staff, in coordination with DoD components. It begins with a resource-informed articulation of national defense policies and military strategy known as the Guidance for the Development of the Force (GDF). The GDF is used to lead the overall planning process. This process results in fiscally constrained guidance and priorities - for military forces, modernization, readiness and sustainability, and supports business processes and infrastructure activities - for program development in a document known as the Joint Programming Guidance. The Joint Programming Guidance is the link between planning and programming, and it provides guidance to the DoD Components (military departments and defense agencies) for the development of their program proposals, known as the Program Objective Memorandum (POM). Programming. The programming phase begins with the development of a POM by each DoD Component. This development seeks to construct a balanced set of...
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...9-204-066 REV: FEBRUARY 11, 2004 MALCOLM P. BAKER ALISON BERKLEY WAGONFELD Dividend Policy at Linear Technology It was April 2003 and Paul Coghlan was pulling together his notes for Linear Technology’s board meeting the following day. As chief financial officer of the Silicon Valley semiconductor company, Coghlan was responsible for making a recommendation about whether or not Linear should increase its dividend this quarter. Coghlan and Linear’s CEO Robert Swanson were pleased with the company’s third-quarter financials for fiscal year 2003, but sales and net income still remained substantially below Linear’s record levels set in 2001. In addition, the technology industry was still emerging from a recessionary environment and it was unclear how strong business would be for the remainder of the year. Linear Technology Corporation Headquartered in Milpitas, California, Linear was founded in 1981 by Robert Swanson. Under his leadership, the company focused on designing, manufacturing, and marketing integrated circuits (semiconductors) that were used in various electronic applications such as cellular telephones, digital cameras, complex medical devices, and navigation systems. Linear’s customers spanned numerous industries and no single customer accounted for more than 5% of its business. In 2002, the communications industry accounted for 33% of Linear’s business, computers 27%, automotive 6%, and the remaining 34% was spread across many different applications...
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...Social Security: Then and Know Deanna Havens SOC 320/ Public Policy & Social Services December 10, 2011 Social Security was established by President Franklin D. Roosevelt in 1935, during the great depression. The social security system was supposed to be a creation that would cover nearly all Americans. Over the years social security has expanded in both dollar amounts and the way you are eligible to receive benefits. Social security smoothes the risks of economic cycles, and it remains the most secure retirement income in America. Intentionally or unintentionally, those who think that the surplus in social security is disappearing are misleading the American public. Social security is financed mainly through payroll taxes on wages, and self-employment income. Employees and employers contribute 6.2 of wages, up to a wage gap of 106.800 in 2009 that ordinarily increases with the growth in the nation’s average wage. The self-employed contribute the equivalent of the combined employer and employee tax rates. According to the annual social security report (2010) income from social security payroll taxes will account for about eighty-three percent of trust fund income. At the end of 2008, nearly fifty-one million people were receiving benefits: thirty-five million were retired workers, six million survivors of deceased workers, and nine million disabled workers. During the last year an estimated one hundred sixty-two million workers had earnings covered by social security...
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...WRENCROFT APPLIANCE COMPANY PROBLEM In 1989, Auditors of Wrencroft Appliance Company (WAC) proposed two different inventory write-downs regarding a discontinued microwave product and spare parts to the company’s audit committee. John Moore, WPC‘s CFO, is in the position to make recommendations to the board regarding the proposed adjustments. He needs to make a careful evaluation of whether the proposed inventory write-downs are necessary for the independent accountants to render unqualified opinion. In order to make sound recommendations to audit committee, John should analyze on the following matters. 1.) Are the reflected amounts in the proposed write-downs based on reasonable estimates? 2.) Is there a sufficient evidence for either write-downs to justify corresponding tax deductions? ANALYSIS Inventory valuation & Estimates for proposed write-downs Discontinued Microwave WPC’s auditor used Lower of Cost or Market (LCM) method as basis for inventory valuation in the proposal given. The discontinued microwave oven was proposed to be adjusted to 40% of the finished goods inventory of 1988 due to the anticipation of selling the units to a large discount chain with an agreement to receive 40% of the cost of the microwaves, while the spare parts manufactured for the microwaves should be disposed of at 5% scrap value. The necessity to write down this bulk of inventory favors tax deduction for the company’s advantage. However the case did not imply that there...
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...paper, you will find the history of social security, and its intended purpose to exist. The debates for the plans for social security will also be discussed; also, the attempts to reform social security, and why the intentions to reform social security have failed. Early Development stages of Social Security Social security took shape during the “New Deal” and post-World War II era. The system has been divided into four main parts, which are: federal old-age, disability insurance, and survivors. These four main parts were adopted in 1935 as a key element of the social security act. The four main parts are now widely known as social security. During the legislative process in 1983, congress made a set of technical changes to solve the fiscal crisis in social security. One of the changes would be a rise in the retirement age from 65 to 67 years of age; this will take place between the years 2000-2022. Overall in 1983 legislation preserved the basic characteristics of the social security program. Actuarial provisions were more favorable in the 1990’s as economic growth helped boost the trust fund reserves. There are current actuarial projections that the trust fund should incur a surplus until early 2010. Although when you take a look in the long run of things the aging and retirement of baby boomers would further increase the percentage of elderly people in the U.S. The percentage is expected to increase between the years of 2000-2042. It is believed by the liberal policy experts...
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...2012 Prince Masuku Economics 3/5/2012 2012 Prince Masuku Economics 3/5/2012 Macro-economic issues role of the public sector Macro-economic issues role of the public sector CONTENTS PAGE Contents Page Introduction… 1 The present situation and a comparison with previous years… 2 The proposal/ initiatives from the State of The Nation Address… 5 Reaction of other political parties… 6 Impact of the President’s proposals on the national budget… 6 How did the budget address these issues?.. 7 Conclusion… 8 INTRODUUCTION Unemployment occurs when people are without jobs and they have actively sought for work. In South Africa, unemployment is extremely high and it is seen as one of the most pressing socio-political problems facing the government. The has been a lively debate on the extent, nature and cures of unemployment in South Africa but the outcome has rather been inconclusive. Unemployment in South Africa is so widespread that it demands an explanation. Unemployment is potentially a matter of serious concern - for its effects on economic welfare, production, erosion of human capital, social exclusion, crime, and social instability. However, its potential costs depend on the nature of the beast. The question we address is this. Is unemployment in South Africa largely voluntary or involuntary? The answer has important ethical and policy implications. If unemployment is largely voluntary...
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