Remixing Knowledge

I found a brochure of MGW Accounting Service in internet. MGW is "a full service accounting & business planning firm." When I visited its website, the firm looked like a newly created.


The audience of the brochure was its clients and people who are looking for accounting services because there was a list of services the firm provides such as profit analysis and costing, GAAP Compliance, new business startups, and more.
Its purpose was clear. The brochure was created to get more people to know the firm and get more clients. In the brochure, there were a lot of phrases like, "success of our clients," which was to show the people how they care about their clients.
I think the brochure was not quite successful since I could find exactly same phrases and comments at the website of this firm. It also did not have a lot of appeals to people since it was like other brochures.


http://www.mgwaccounting.com/

Recognizing Significance

Instead of reading story that just shows the importance of my field, I decided to read about a story that shows the consequence of being dishonest in the field. I believe that because the consequence of wrong action is big, the occupation's importance is also big. The story that I read is about the collapse of Arthur Anderson, once a huge audit firm.

Arthur Anderson is a prestigious Chicago auditing firm that was once a part of Big 5 auditing firms with current Big 4 (Deloitte, Ernst & Young, PWC, and KPMG). However, due to faking the financial statement of its client, Enron Corp, Arthur Andersen was convicted of obstruction of justice. Enron Corporation is "an American energy, commodities, and services company based in Houston, Texas." Even though it was only once, a huge and famous firm lost its reputation and met its demise not long after the scandal.

When I read about this event, I realized how being honest is important as an accountant. One mistake in accounting can cause a huge company to shut down. I believe that since accountant's roles are important, the responsibility of being an accountant is very high.

"The Fall of Andersen." Chicagotribune.com. Chicago Tribune, 1 Sept. 2002. Web. 03 Nov. 2012. <http://www.chicagotribune.com/news/chi-0209010315sep01,0,538751.story>.

 "Enron." Wikipedia. Wikimedia Foundation, 24 Oct. 2012. Web. 04 Nov. 2012. <http://en.wikipedia.org/wiki/Enron>.

Practicing Your Knowledge

After graduating from the secondary school and before coming to Michigan, I bought a textbook about accounting. However, since it was free time and I did not want to study, I did not really start reading the book. So, I started reading the book this week.

Since I need to write about a hands-on experience that will allow me to learn about accounting for this blog post, I tried to look for basic skills of accounting. One of the basic skills of accounting is writing balance sheets.

As a result, I started solving balance sheet questions and created balance sheets with the data given in the textbook. I actually had hard time understanding the theory and method of writing balance sheet by just reading the textbook. However, when I started writing out the balance sheets by myself, I soon realized how things worked. For example, the total liabilities and the total equity should equal. It was surprising at the first time how it comes out to be same and I was curious if same thing happens with the balance sheets of huge companies where the values are large.

Open Blog Post - Answers to Exploring Writing Process

I was going to ask Professor Bronson. However, I could not get any of her contact information. As a result, I asked the president of MSU Accounting Club for Asians for an accounting professor's email address. Then he gave me a contact information for Professor .
I sent him an email, and he told me to visit his office on Friday morning. So these are the answers for the questions.


1) What do you write?

 - He normally writes research papers, memos, letters, and journals (records of transactions).

2) How do you write? (The process of writing)

 - 1. He asks what the purpose of the writing is.
   2. He gets a big idea like a theme.
   3. Then he sketches out an outline.
   4. He writes paragraphs with one idea in each paragraph with neat transition.
   5. He writes first draft and cut out unnecessary parts.
   6. He edits the essay trying to be concise as possible.
   7. He lets it sit for few days.
   8. Finally, he reviews it with fresh eyes.

3) How long have you been teaching accounting?

 - He has been teaching accounting for 10 years.

4) What is advantage of having Ph.D when becoming an accountant?

 - Ph. D can teach people how to research and gives people authority to teach in big schools like Michigan State University.

5) Why did you choose this field?

 - He firstly went in general program and experienced several fields of study. Then he realized that he has natural talent in accounting, and he enjoyed learning it. As a result, he received degree in accounting in MSU in 1987.

 He taught me new word "Journal," and I learned a lot about the profession. It has been a great experience and I hope I meet him when I get into Eli Broad College of Business. Also, on the day of interview, since I am not familiar with the business building, I had hard time finding his office. As a result, I was almost 20 minutes late. I hope he did not have bad first impression about me.

Contemplating Controversy

I read a source about the problem about management accounting.
It is an article titled, "What's Wrong With Management Accounting?" and is based on Van der Merwe's philosophy, "Management accounting philosophy I: Gaping holes in our foundation."

There are many problems the management accounting is encountering with.

"1) it holds management accounting in a state of ambiguity, confusion, and frustration,
2) if there is no truth, there is no basis for evaluating the various theories and approaches to management accounting,
3) frequent bias by those with vested interest in a particular approach causes arguments that range from factual
    statements to character assassination,
4) if there is no truth, there is no lie,
5) real progress is difficult since there is no underlying basis for critical thinking,
6) no common frame of reference makes it difficult to communicate with managers and others looking in from
    the outside (e.g., students and prospective students),
7) no convincing case can be made for the value of management accounting to the enterprise."

In order to solve these problems, two solutions were suggested. They are law of non-contradiction and the law of rational inference.However, there are drawbacks for both solutions.
Why do people need management accounting despite of all these problems?
It is because organizations need to operate in the most efficient and proficient way, all available resources must be chosen, organized and managed appropriately to accomplish the organizations goals and objectives.



Martin, James R. "What's Wrong with Management Accounting?" What's Wrong with Management Accounting? N.p., n.d. Web. 17 Oct. 2012. <http://maaw.info/ArticleSummaries/ArtSumVanderMerwe07(1).htm>.

Evaluating Sources

I read a scholarly Article, "ACCOUNTING CHANGE BEHAVIOR: THE RELATIONSHIP BETWEEN EARNINGS ADJUSTMENT AND FIRM-SPECIFIC EXPLANATORY FACTORS. AN EMPIRICAL ANALYSIS."

"What factors influence the choice of firms' accounting systems?" This is the key question of this journal. There are two different types of views to this question. First is "economic" view. This view is management belief that the cashflow influences the change in accounting behavior. In this view , factors related to the exposure of the firm to political costs, the firm's lending agreements, bonus compensation contracts, and the percentage of stock ownership held by management is assumed as relevant in explaining change in accounting behavior.
Second view is a "naive" view. This view is, also, management's belief in naive capital markets. This view assumes that the change in behavior is influenced by the earnings measurement. In this view, factors related to the firm's past and current earnings realizations are assumed in explaining change in accounting behaviors.

I think that the "economic" view is more reliable and trustworthy. The reason is that there are more factors that can explain the answer. However, since the two views are related closely. I think it would be better if the two views are combined.



Moses, Orrin Douglas. "Accounting Change Behavior: The Relationship between Earnings Adjustment and Firm-Specific Explanatory Factors. an Empirical Analysis." University of California, Los Angeles, 1983. United States -- California:ProQuest Dissertations & Theses (PQDT); ProQuest Dissertations & Theses A&I. Web. 10 Oct. 2012.

Open Blog Post - AACSB

I suddenly got curious about what it takes a business school to be official. So, I did a research on it, and I learned that official business schools were accredited by AACSB. AACSB (an Association to Advance Collegiate Schools of Business) was established in 1916 as a membership organization for business schools. Currently, Eli Broad College of Business at Michigan State University is officially accredited school by AACSB.
In order to gain accreditation by AACSB, "first, a school must be a member of AACSB International and offer degree-granting programs in business or management. Next, a school may apply for AACSB accreditation. The school’s application is carefully reviewed to ensure it is eligible to pursue AACSB Accreditation. Once it is determined that a school has the potential to be accredited, it works with mentors, committees, and AACSB staff to develop a Standards Alignment Plan. Once a school follows through with its alignment plan and meets the AACSB standards, review committees and the AACSB Board of Directors decide whether or not a school should be accredited. In its entirety, the AACSB accreditation process is rigorous and requires a significant amount of work to achieve."
However, it does not mean that once accredited school is accredited forever. Schools can lose their accreditation. School undergo a thorough review that is focused on the delivery of high-quality education, continuous improvement, market relevance, and currency.