Enzo Ferrari Leadership Strategy

Enzo Ferrari Leadership Strategy Enzo Ferrari was born in Moddena (Italy).He was Italian race car driver and entrepreneur. He founded the great motor racing team in history The Scuderia Ferrari f1 team and Ferrari car manufacturers .During the world war one Ferrari served in the Italian army and upon his return from the army he found that his family business collapsed. he then settled for mechanic job ,he left this job at 1920 to work for Alfa Romeo and also racing their cars. Ferrari had lot of success in local racing. Ferrari was manager of the Alfa Romeo car factory and also had a team of 40 drivers including him to participate in races. This was done under the banner of Alfa Romeo in the early days. Then on Ferrari started to get more grip on Alfa Romeo Company. When Alfa Romeo took more control of the racing Ferrari left Alfa to form his own racing team . First formula 1 race of Ferrari was in 1950. Ferrari is the only team in history of formula one to participate in every single championship. After their first victory in the British grand prix in 1951 what happened that is all history return in golden words .Car manufacturer whose every car enter the market is a success and a formula one which every driver want to drive at some point in their career. This is what Ferrari is. He died at age of 90 in 1988 I have chosen Enzo Ferrari as my leader because I admire him on what he have achieved from being a mechanic in workshop to a leading car manufacturer . Whatever I do I do it with a passion . And the leader I have chosen was highly regarded for his passion for fast moving cars , racing, and above all success in his area of expertise manufacturing cars. He was determined and achieved the level of success he wanted to be in. He motivates me to achieve the impossible . So I didnt had second thought in picking Enzo from my favourites for the position of leader profile that I am gone to work on for the leadership assignment. Analysing the leader based on Leadership Theories Trait Theory Traits refer to the trend in personnel behaviour. Effectiveness of the leader can be valued based on the traits possessed by the leader .we get more information on traits when we keep constant eye on consistent pattern of behaviour. How people behave in weak situations also comes into account when referring to trait theory. Enzo Ferrari analysed based on trait theory . Enzo Ferrari is regarded as effective leader during his era. Ferrari possessed various traits. When considering all traits he had there are some traits worth mentioning here. Self confidence, trustworthiness, assertiveness, enthusiasm. Incidents which Ferrari showed immense self confidence were starting scuderia on 1929, serving as manager and driving high speed cars, his ability to put things together at bad times to ripe better results in future. Self confidence is trait which all leaders have in their custody .so what made Ferrari a stand out in that. Self confidence is one thing that each motor sport racer have in their pocket .Because when you are speeding at 100 mph per hour in old times with no much protective gears in the cars you ought have some confidence to press the pedal even on sharp bends. Ferrari also showed his self confidence while entered into formula one without much support or sponsorship. The confidence Enzo had is still seen in the Ferrari team evidently. Enzo Ferrari has transferred one of his trait to his team that is assertiveness. which Ferrari car manufacturer have and Ferrari formula one team always shows in the entire history of motorsport . This trait was seen in Ferrari either in selecting drivers , making strategic decisions ,resolving company issues etc . Enzo always valued trust . give and take policy was usually adopted in the case of trust by Enzo . Alfa Romeo ,and other partners of Ferrari sees Ferrari as a trust worthy person .Enzo Ferrari always created enthusiasm in the people who he deals with . As a person who is really enthusiastic about the formula 1 racing , he poured that enthusiasm into his workers and formula 1 drivers . The level of enthusiasm Scuderia Ferrari is showing now in motor sport was from their dear leader Enzo Ferrari .This is main reason why which Ferrari team is winning championship and hunger to go for more. High energy and physical stamina helped Ferrari to participate in racing events apart from being the manger of scuderia.Ferrari was a reserved character , and usually not found of interviews .Enzo had all qualities in work related characteristics of a leader , when Alfa Romeo withdraw their entire support Ferrari fought against the obstacles and hardships through determination and desire to excel. His friends and technicians were sure that one Enzo is going to be great man . Enzo was practical and had responsibility in achieving the goals. Every time his decisions were not right , like once they lost a championship due to wrong selection of tyres by Ferrari .Winning racing and making unbeatable sports cars are resulted from team effects but Ferrari consider himself only accountable for all wrong moves and for success he made sure that credits usually goes to his team members. Behavioural Theory This approach says that anyone who adopts appropriate behaviour can be good leader. We usually consider two approaches ( autocratic and democratic) to analysis a leader. Behavioural theory and Enzo Ferrari In the early days itself sucedria Ferrari had policy of splitting the responsibility .Enzo Ferrari usually delegates the responsibility among the his crew . when Enzo was working under Alfa Romeo , Alfa used to share responsibities with Enzo like giving the control of racing team , positioning the strategies etc. Ferrari when started his own car manufacturing he used to share the authority to good and sound technicians to develop some best cars. Enzo also valued the comments of his mechanics and drivers ,This is also due to the fact that his profession also demanded him to be a democratic leader. He is not a person who is leading a country but a person who leads group of mechanics to produce world class sports cars . country can be run by a autocratic leader but a car company cannot . According to the workers of Ferrari car company Enzo Ferrari was charismatic and affectionate leader. Leadership style of Ferrari was a combination of boss centred and subordinate centred leadership. Applying Gardners roles on Ferrari ,he had goal to become world class car manufacturer and wanted his cars to won in formula 1 races , he managed and fixed values for the team . Ferrari served as racer for initial time and manged Alfa Romeos racing department. Ferrari was successful in achieving a workable unit with him Ferrari roped in some finest drivers like Fangio, Hill etc and got some really good mechanics from British car companies and Italian companies like Bugatti . Rene Dreyfus an ex Bugatti driver Says that he learned the business of motor racing from Ferrari . Ferrari was a great motivating factor for the team ,in the initial years Ferrari was a manger and racer used to attend races while other drivers are driving for scuderia .In last few years he didnt attended much races ,he got information about the races over phone from his employees but this was not his workers and mechanics want to see him in the motor sport arena and in the paddock with them as motivational factor .Such was the effect of Enzo Ferrari on his team.Constant conversations and explanation happened between Ferrari and his racing team . He used to explain about the car to his formula one drivers because in this sport good understanding about the car is essential for the success.Also the conversation between mechanics and manager Enzo was crucial in developing some of finest formula 1 cars Ferrari has ever produced .Till death in 1988 Ferrari served as a symbol of Scuderia Ferrari motor sport . Ferrari named one their cars as Enzo Ferrari in the remembrance of their great founder. The team Ferrari was represented by Enzo not only in the name but also in and out of the formula 1 field. As a leader of Ferrari motor racing team and car manufacturing Enzo always representative for his mechanics and drivers in the public . Although Ferrari was a reserved character and rarely gave interviews to media, his passion for the motor sport and love for cars made him the ideal representation of sc uderia Ferrari . Enzo Ferrari was consistent but adaptable to change in situation , when Alfa Romeo wanted more control in racing Ferrari thought of starting own car manufacturing using all limited resources available and bringing in new talents to his team . During 1960s Ferrari had financial crisis so he had talks with Fiat and got their support and over these years Ferrari team also followed the same tactics ,that is getting new support like shell, Pirelli etc as partners in formula 1 sport. Enzo Ferrari in the Leadership context Taking whole leadership context into account, there are certain things which are really applicable to Ferrari . There is nothing much to say on his traits and behaviours as there are already mentioned above. There werent much values that Ferrari used to put into his leadership style, nor much of an ethical approach. Ferrari is considered as a pure business man, although he love cars there is no sentimental relation with cars that is he was ready to sell old cars for scrap value if they are not working properly .In a way Ferrari used path goal theory to accomplish his vision. At that time face to face was reliable communication method although telephone was also there. When Ferrari started to not attending races his employees would convey the information about the races over the phone to Ferrari . Ferrari was a charismatic leader according to his friends and I also fee l the same . He was more of a transactional leader .This is evident from the strategy he adopted when there was a sho rtage of money, drivers will get the percentage of the winning money from the races . Drivers who have passion for motor racing work for fun and money , the fun they get from driving high speed cars and money from winning races ,so being a transactional leader Ferrari was able to employ some 40 drivers during 1940s They won him races and he paid them well . Enzos contribution to Ferrari company is what made him truly special . His vision was to make some unbeatable cars in the history of formula one and he and his crew was able to achieve it . Also the entire motorsport industry benefited from the advanced techniques introduced by Ferrari .Enzo Ferrari was job oriented than people oriented but still took a good care about his racing drivers. He used to remember the drivers who shed their life in the track with great pain and agony. Ferrari had structural frame of reference than human resources frame in gather information, make decisions, and exercise power. During the last years of his careers may be due the experiences he gathered, Ferrari turned into human resource frame of reference . Power and influence Power means the ability of the Ferrari to influence the people in his organization to bring desired outcomes . Influence in this context means how Ferrari was able to influence people in attitudes, actions etc .Ferrari had personal power He was an expert in the field of motor racing ,the knowledge he acquired during the days as manager of Alfa Romeo racing department, through his relation and experience with drivers and mechanics is what made him an expert in his area .So subordinates followed his ideas .Referent power are visible if leader is charismatic , Ferrari is regarded charismatic leader . This has effect on Ferrari formula one team even after 21 years of Enzos death .Reason is that Ferrari team is made up of passion and love for fast cars and racing .The influence Enzo had on his team in the early days was hunger for victory .This is still continuing even after his death through the never lasting thirst for victory in races for ferrari formula one team . The response to the type power Ferrari had was commitment from his workers .This commitment was really essential for building up of successful formula one team. Conclusion In the entire human history we come across many varieties of leader ,some truly great and some people want to forget from their memory . So what makes one a great leader. There is no single recipe answer for that. All the ingredients in right mixture makes a good dish same for leader also , effective traits, behaviour, influence on people, the way leader carry himself etc will result in evaluating him as a successful leader or not . Enzo Ferrari was a great business man and visionary but was he one of the greatest leader of all time ?, not really because he was the leader of a business empire, he has not transformed any individual to another level of potential or hasnt done something exceptional for mankind. Then what makes Enzo Ferrari special, a man who started as a mechanic after the collapse of family business, went through all hardships, fought against all odds to build an empire, a truly amazing car company which glitters in the car industry world .Ferrari was able to convert h is passion into reality. He was combination all effective traits for leader but didnt had anything more than a limit, like everything in proportion, that made him stand out. More job oriented character invited some criticism from his friends in early days, but he didnt changed his style. Being consistent that is what I liked about Ferrari. The stamina and self confidence from being a race driver helped him in his decision making. Life is like a chocolate box you dont no what you going to get from it this is applicable for race driver. A race driver is not sure what will be the result at the end of the race he just push the pedal and hope for a win ,same was done by Ferrari he wanted to win in the races and in business his drivers won the races for him and his leadership style and strategies combined to form the success in business. From a simple life to a millionaire life the journey of Ferrari was as exciting as a formula one race from start to chequered flag. When we look back int o the life history of Enzo Ferrari only thing he likes to convey is dreams will go in speed of f1 car but the control should be yours.

Economics

The most common belief is that Agency Theory is based in the economic model of man (e. G. Brenna , 1994). Jensen and Neckline arguing that the theory is grounded in what they call REAM – the Resourceful, Evaluative, Maximizing Model (Jensen , 1994). They argue that the REAM most closely replicates human action and that the economic model of man is a simplified version that does not reflect the spectrum of human behavior. Lets see a table that compares the two of them with logical order. Comparison of Economic Model of Man and REAMEconomic Model of Man Rational Bounded Rational Maximized Maximized based on thorough evaluation Motivated by incentives Actions driven by Incentives Self-Interested Opportunistic with guile Opportunistic if beneficial Focus o Focus on extrinsic rewards Will substitute goods if beneficial (not driven exclusively by extrinsic rewards) Not other regarding Altruistic if beneficial Resourceful Resourceful – innovative when facing constraints and op portunities With the understanding that man is self-interested, ever opportunistic and driven by incentives, agency theory addresses the effect of having this man as manager in the modern corporation by providing prescriptions to taming him. Industrial organization economics providing a basic theoretical perspective on the influence of market structure on firm strategy and performance. There is a range of specific models, major determinants of firm-level profitability include: (1) characteristic of the industry in which the firm competes (2) the firm's position relative to its competitors and (3) the quality or quantity of the firm's resources. (1 )landlers variables A long tradition is concerned with identifying properties of industries intriguing to above-average profitability.A large set of variables (growth, facilitation, capital and advertising intensity, etc. ) have performed differently in different studies, but the overall importance of these factors is beyond dispute (Rever berant, 1983). (2)Variables relating the firm to its competitors Originally perceived as the source Of market power market share and more specifically relative market share as viewed for this study serves as a proxy for some firm-specific relative competitive advantage resulting from learning effects and other firm specific assets. (3)Firm variables The typical economic model of firm performance explains from 15 to 40 percent of the variance in profit rates across firms.Apart from random effects, measurement errors, and so forth, one can suggest at least three explanations for the ‘remaining' variance. First, there may be important economic variables, the extent of which cannot be measured (e. G. Assets that are specific to an industry or a trading partner). Second, the ‘true' model may be such that intervening economic variables differ from case to case, making aggregate analysis difficult. Third, with very few exceptions organizational factors are not considered in thi s literature. ORGANIZATIONAL MODEL OF FIRM PERFORMANCE Perhaps even more than their economist counterparts, organizational researchers have developed a wide variety of models of performance.As an example managers can influence the behavior of their employees (and thus the performance of the organization) by taking into account factors such as the formal and informal structure, the planning, reward, control and information systems, their skills and personalities, and the relation of these to the environment. But on the other hand we have some questions about firm performance. Can a firm be over-differentiated in one area and under fractionated In another, but on the whole be just about right? In contrast, firm performance is an aggregate phenomenon. Numerous studies have demonstrated how changes in organizational structures, systems and practices have altered climate measures and hence individual performance .Both organizational structure (span of control, size, levels) and organizat ional processes (performance reviews, budgeting, collaboration) were more closely associated with climate measures than with performance (both subjective and objective) measures, and that organizational climate was directly linked to performance. Other more clinical efforts have shown linkages between managerial practices and attributes or dimensions of organization climate and firm performance . Figure 1 illustrates the assumed causality Of the traditional climate model Of firm performance. This thesis has uncovered a number of interesting points, many of which are perceived to lend themselves to exam aspects for further research.It would be interesting to obtain a more solid picture of our research and wows that research may provide an interesting basis for comparison with respect to the impact and consequences of Agency Theory and Firm performance within report governance mechanisms utilized today. Economics Policemen are seen all over the world as peacemakers, who base their actions on Just and sound principles In order to maintain law and order within the country. The police force Is an Integral part of society not only In that It manages to apprehend wrong doers but also act as a deterrent for the prevention of crimes which could, otherwise disrupt internal harmony within a society. As such the police have within them, certain ‘powers' to aid them in carrying out their duties, which put them above the law. However the question lies in the extent of such a power the state should stow upon such an organization.The determination of how much power to allocate to these police forces rests on the conditions of a country, society and people Involved, as well as whether these powers given would affect collects Individuals. Policemen shoulder responsibility, huge responsibilities in fact. They are tasked with upholding and protecting the moral values society has put in place. They should therefore have the right to unlimited power because it allows for them to be able to stand above crime in the country to be able to efficiently put out wrongdoers and their actions.This Is based on the assumption of course that policemen themselves are not corrupt and would not abuse such power given to them. If policemen's powers were subject to boundaries and conditions, meaning that they are denied of certain powers and rights that would allow them to swiftly bring Justice to perpetrators then their duties would be severely hindered and crime could end up being a problem in society. One such example would be could be seen in Singapore whereby police officers and Its governmental systems have been known to be one of the least corrupt in the world.In this, the SSP, or otherwise known as the Singapore Alice force hold significant power in society in that they are able to rise above individuals in society to be able to make clear Judgments and arrests to ensure law is being abided b y. It's power can be seen in it's ability to conduct arrests of longhairs, gang members etc without having to go through much obstacles such as bureaucracy due to them wielding sufficient powers of their own to decide on choices on the spot so that the problem does not persist. This amount of power awarded to the police force of Singapore allows it to perform Its duties with utmost efficiency.The result, one of the safest countries to live in the world, recording one of the lowest crime rates as compared to Brazil. Seen here, the importance of not holding back power given to the police force ensures a country remains stable to be able to advance economically and socially. However as seen, assumptions In the real world rarely hold. Policemen are humans. And humans are subject to greed that gives rise to corrupt behavior in an attempt to gain more. Therefore policemen should not be given unlimited power because it sometimes interferes with our individual's intrinsic moral values of fr eedom.The very fault in such a society lies in that ordinary citizens have no power against policemen and the law. In what many may argue that In a free world we live in today, we as Individuals have sovereignty and the free will to choose what we want, libertarians as we are governed by the many laws outside of us that do not make us autonomous. Such laws could trample upon our basic rights of freedom. And thus allowing the police, who are part of the law to hold significant, unlimited power would severely undermine our freedom as individuals.Take for example earlier in the year, George Thompson who lives in Boston was arrested by policemen not for murder, not for theft, not even for indecency, but for filming a police officer which he deemed to be out of control. Also in the US was a man in Baltimore who was arrested and threatened after police found out he was recording them. The conversation between them read: Man: I have my rights Police: You have no rights Man: I thought I had freedom of speech here Police: You Just lost it As seen the conversation(cut short) between them exemplifies what many would term absurd.Something as harmless as filming in a technologically advanced world we owe live in could cause us to get arrested. Although it could be said that there was a thin line to be drawn between respecting the police officer and the freedom of the man, it can be argued that the arrest of this man from Baltimore was based on no justified grounds. The unlimited powers the policeman had had cost the man his freedom because he, as an ordinary citizen had no choice but to bow down to the orders of the police officer. Hence unlimited powers given to policemen tend to be abused.Instead of trying to police the world, they should in fact be concerned with policing their own organizations instead. Hence their power should be limited. Conditions within society could also mean that unlimited power given to law enforcement agencies would present detriments to the co untry. Conditions such as social hierarchy that could still be present in third world or developing nations. These class systems, coupled with unlimited power given to police agencies would pose a huge problem to a country.This is so because policemen as said earlier are ordinary citizens as well, meaning that they are subject to discrimination and biasness towards a certain group. This could mean that rights of the minority could e stripped away because of social hierarchy. India is a good example to showcase this. Lately the country has been subject to cases of rape and murder of women. In this aspect policemen despite wielding significant power, the past 3-4 months have seen numerous cases of Indian women getting raped and afterbirth murdered. With the most recent case citing that 2 girls, aged 14 and 15 were raped and hanged from trees.The two girls who were cousins after being raped were hanged. This incident sparked outrage not only because of the brutality of such an inhumane action but cause police officers and officials refused to investigate into the matter. The reason being, these girls were of a lower caste and therefore it would not be worth their effort and time to dwell deeper into the matter. Further aggravating the matter was comments from the local police officials saying that such rape incidents should be considered as trivial due to the rampancy and frequency of such rape incidents.Condemnation of such a reaction soon broke out and eventually caused the government to step in as police agencies in that region were not up to the task. Such security of people in India born into lower castes would be affected with their interests not being cared for. This goes against the advocating of human rights and basic freedom for all. Even with the seemingly unlimited power policemen had in India, they were unable to make sound Judgments of the rape case causing many more of such cases to persist.One possible reason is, as stated, because of the presence of the class system that is still prevalent in India today. Because of this the only way the issue can be solved would be to grant police officers there lesser power ND to leave it to government intervention where a most Just decision and action can be made. Therefore the police should not have unlimited power in this case as it would lead to discrimination and social instability. Lastly, police should not be granted unlimited power because they are not, and should not be seen as ‘guardians or kings' of our own moral principles.They should not have the rights to have absolute grip and rule over our lives and decisions we make as it is morally unjustified. This argument on freedom dates back to debates amongst philosophers and two main schools of thoughts. Utilitarianism and Libertarianism. In short utilitarianism supporters such as Jeremy Beneath held the view that our individual rights should be forgone for the sake of the greater good of society whereas libertarians such as John Locke and Nonionic argued otherwise, that our individual rights should be upheld.In that it states that there should be the existence of a minimalist state with no paternalism and morals legislation which simply means no laws put in place to dictate how people should run their own lives. In the real world this is too extreme for such a notion to thrive in because humans quire constant guidance as we sometimes stray off the wrong paths. However if we were to go along the lines of a libertarian argument we can see the importance of individual rights and how the law agencies such as the police should not be ultimate rulers of our own moral principles and decisions.Giving police agencies unlimited power would be akin to giving them the rights to impose certain laws on us, some of which would not benefit. Although many who oppose this might say what would happen if there is little or no one to keep tabs on society, won't society go out of control with crime rates rising? This would therefore call for limited powers granted to the police, such that they still hold enough power to enforce the law, but not enough power to infringe upon our individual freedom.One way to see it would be how Emmanuel Kant a proponent of libertarianism argues about the importance of championing our intrinsic rights to freedom. He states first of all that We as human beings are rational and worthy of dignity and respect'. This bold statement shows that we are capable of sound thinking and hence deserve respect and dignity. Therefore to allow police to be masters over our lives through granting them unlimited power would be first of all, unnecessary and secondly, would mean that our individual rights are ignored.Thus policemen should not have unlimited power because it is not Justified. In conclusion as the quote goes, With great power, comes great responsibility. Certainly the powers bestowed upon police should come with great thought and repercussions that could arise as a result. I n this view, I believe that unlimited power should not be granted to police in dealing with social issues such as crime because it would result in the abusing of it that could in turn lead to our individual rights being stripped away. Economics Internal growth strategies refer to the growth within the organization by using internal resources. It focuses on developing new products, increasing efficiency, hiring the right people and better marketing. Should Voodoo want to expand into Africa to sustain profitability it can use its can consider its internal growth Voodoo can now then focus on what it already had this includes the quality it gives to their customers this including its latest development of LET which is fourth generation outwork 46.Expansion Raising the market share, sales revenue and profit of the present product or services. Market penetration Selling existing products to existing markets. To capture the market Voodoo needs to focus on its mission statement which is providing its customers with good coverage network which comes in Voodoo is still improving on its network coverage with an investment of R 120 000 000 and a year technological advancement and an additional R 2. Mil for its skills development. In tu rn Voodoo can retain its existing customers and at the same time attract more customers that require the best network coverage like LET that was developed by Voodoo before its competitors giving It much more competitive advantage. Market development Extending existing products to a new market. Voodoo alms at reaching new customer segments, wants to Increase sales by capturing new market area.Voodoo is currently the giant mobile providers In South Africa at the moment they are a growing mobile industry which Is owned by Britain Avoidance, they deciding to attract ore customers outside Brittany and South Africa, would need a market strategy from the marketing research, and the Initial Investment It needs to Invest this also including the politics of different countries In Africa. Product development Developing new products for existing markets or new markets, making some modifications In the existing product to give value to the customers for their purchase.Voodoo decision to Invest I n Its quality of Its network coverage has gave Its brand Image a boost In the market. Voodoo was the first mobile network In south Africa to cover G,G, and Its latest G network which Is LET from Its competitors proving that Its customers will get value for their money. It continues Investment In Its multimillion rand technological development keeps It ahead of Its competitors. Diversification The purpose of delectation's Is to allow the company to enter new lines of business that are different from current operations. There are four types of delectation's: vertical, horizontal, concentric and conglomerate.Voodoo before its competitors giving it much more competitive advantage. Market Extending existing products to a new market. Voodoo aims at reaching new customer segments, wants to increase sales by capturing new market area. Voodoo is currently the giant mobile providers in South Africa at the moment they are a growing mobile industry which is owned by Britain Avoidance, they deci ding to attract the marketing research, and the initial investment it needs to invest this also including the politics of different countries in Africa. Product development modifications in the existing product to give value to the customers for their purchase.Voodoo decision to invest in its quality of its network coverage has gave its brand image a boost in the market. Voodoo was the first mobile network in south Africa to cover G,G, and its latest G network which is LET from its competitors proving that its customers will get value for their money. It continues investment in its multimillion rand technological development keeps it ahead of its competitors. The purpose of diversification is to allow the company to enter new lines of business that are different from current operations. There are four types of diversification:

Gold Bear Golf INC. Essay

1.The professional auditing standards have a set of five management assertions. Of the five assertions, three are very important in regards to the Paragon audit. The descriptions below, audit procedure is explained that would have ensured the audit was completed accurately. a.Occurrence- The management assertion that ensures a particular transaction actually happened. In the case of a construction company such as Paragon, this could be verified by going to a job site and checking to see if the job is actually happening. b.Valuation/Allocation- The management assertion that ensures the transactions are accounted for the correct amount. Changing from percentage-of completion method to the earned value method resulted in significantly overstated revenues and material misstatements in the financial statements. The audit procedure that should take place in this situation is inspection of the records. Looking back at the records would show the change was not supported by the accepted accou nting standards. c.Presentation/Disclosure- The management assertion that ensures all changes within a company are stated in the notes of the financials. These changes should be easy to understand and depict a complete picture of the company from the year. The audit procedure that should have taken place during the audit is inquiry. Sullivan and the staff should have questioned the managers on his or her decisions instead of taking their word as to why the changes were made. 2.The audit failures the SEC were referring to was the fact that Sullivan and his staff relied on the manager’s word. Sullivan and staff did not perform the accurate assertions to test the information provided from Paragon’s managers. The audit partner, Sullivan in this case, is the individual who is in charge of ensuring everyone on the audit is performing his or her job completely and accurately. Sullivan will take the blunt of the responsibility because he is ultimately the person who is in charge of overseeing the auditing the audit as a whole, but the audit staff should also face consciences from the findings. 3.A high risk audit means the chance that of material misstatement and fraudulent activities are significantly higher. Weak controls, changes in management, and changes in accounting methods are several reasons why an auditor would conclude a company is a â€Å"high risk† engagement. The audit partner basis the risk of engagement on his or her observations from the company. When working a high  risk engagement, an auditor will examine a higher percentage of the transactions from throughout the year. Checking more transactions means the auditors are going to produce the most accurate financials possible and ensuring no fraudulent activities are taking place within the company. 4.Auditors do have the responsibility of following the AICPA Audit and Accounting Guides for specialized industries. The AICPPA set guidelines for companies in these industries to follow to ensure the end product is of highest quality. Auditors should make sure the managers are following all of the rules and regulation set forth for that type of company, but these guidelines should never override or replace the Statements on Auditing and Standards. The Statement and Auditing Standards is the rule book for how and what is to be performed in an audit. the AICPA should make the Audit and Accounting Guides for specialized industries in accordance with the Statement and Auditing Standards so the companies are operating with the highest quality, in both products and financial standing. 5.When making a change in the accounting principle used within a company, there has to be very good reason why the company wants to. When these changed are made, they must be presented retrospectively. Managers must produce the financial statements for the past several years so the public can see the effects it has on the company. On the other hand, the changes in accounting estimates are applied prospectively. Managers use the new method in estimating cost and revenues from that point forward. The changes Paragon made are for accounting estimates. The percentage-in-completion method and the earned value method are accounting estimate methods. Boyd and Curbello will use the new method from that point forward. The problem Paragon ran into is disclosure. The changes were not properly disclosed in the financials. This is a problem because two method result in very different numbers for the company.

Health Care And Hospital Systems - 970 Words

Running head: HEALTH CARE AND HOSPITAL SYSTEMS 1 Health Care and Hospital Systems Between Two Countries: Italy and the U.S. Jacqueline S. Valladares Western Kentucky University HEALTH CARE AND HOSPITAL SYSTEMS 2 Health Care and Hospital Systems Between Two Countries: Italy and the U.S. The healthcare system of a country is an important unit that plays a key role in ensuring that a country is able to cater for the healthcare needs of its population. It can be referred to as a network of organizations, trained personnel and facilities within a country; which are used to provide medical services to the population. Medical services are geared towards preventing disease, diagnosing†¦show more content†¦Its necessary do develop an effective healthcare system and this can be aided by investing significant amounts of resources needed to develop quality healthcare services (Garson, 2000). This paper aims to make comparisons between the healthcare systems of the U.S. and Italy. Healthcare and Hospital System (The U.S. and Italy) Developing countries are characterized by ageing populations and advancements in technology have impacted on the way healthcare services are delivered in such countries. The HEALTH CARE AND HOSPITAL SYSTEMS 3 United States is located in North America whereas Italy is located in Europe and has one of the oldest populations in the continent. The two countries vary in terms of the size of their populations, standards of living, size of their economies, quality of healthcare personnel, nursing education and cultural practices. U.S. comprises of a population of over 316 million people whereas Italy has a population of over 59 million people. The US has a life expectancy rate of 79 years whereas Italy has a life expectancy rate of 81.5years. Annual spending on healthcare in the U.S. during 2014 was over $2trillion whereas in Italy, healthcare spending costs accounted for 9% of GDP (Carollynn, 2014). Funding healthcare in the U.S. is aided by a variety of arrangements ranging from insurance, (Employed individuals and their families are at times funded by their employers, self-employed individuals on the