Accountability Challenges In Organizations -Myassignmenthelp.Com

Question: Discuss About The Accountability Challenges In Organizations? Answer: Introduction The management accountants in Global Organizations no longer relies on the traditional methods of only focusing on aspects of accounting. The introduction of concept such as hybrid accountants within the organizations is becoming more evident in nature, which are seen to be responsible for addressing the different types of the needs associated to accounting. Some of the important form of the challenges are considered to be evident in form of the continuous changes in the business scenario. Companies are showing the need for a more proactive management accountant who are readily accepting challenges and become a part of the management. The important consideration discussed in the report is further seen to be identified with the organizational and environmental factors, which is regarded as a major form of the contributor to the significant challenges. Project Objective The report aims to propose a research plan for identification of the relevant issues pertaining to the environmental and the organizational factors for portraying the challenges of accounting in global organizations. The learnings of the research will consider various factors which affects the accounting practices. The study will further aim at understanding the theoretical and methodological gaps in accounting practices which are conducive in explaining the rationale for failure to anticipate the changes in the business and respond to the same. Project Scope The main factors identified to pertain to the changes in the accounting practices will be considered with the technological changes, adaptions to the changes in business environment, financial crisis, role of the management accountants and organizational factors. Some of the other factors are considered with the adherence to the changes in the financial standards. The scope of the project will be able to discuss the possible challenges faced by the accountants during any publication of rulings or accounting frameworks. The research will identify both the qualitative and quantitative findings to support the research paper. Role of Management accounts The present role of the management accountants is considered in terms of formulating the financial strategies, explaining the financial consequences of the financial decision making and monitor the expenses to maintain the profit margins. The management accountants are seen to control the operational aspects of the company. The factors are understood to be causing most of the challenges in terms of accounting practices. The formulation of the financial strategies takes a considerable amount of time to formulate the financial strategies with the use of the sales forecasts, budgets, job costing techniques and the use of the several types of the managerial accounting tools. In addition to this, the changing role of the management accountant is inferred with maintaining profitability, which in many situations involves performing complex business functions such as weighing of sales against the fixed and variable costs (Bebbington, Unerman and O'Dwyer 2014). Financial crisis and Challenges of Accounting in Global Organizations Financial reporting and the current practices of accounting affects the financial crisis in number of ways. The most eminent financial requirement of reporting is considered with governing of the asset valuation and the number of considerations associated to off-balance sheet entities. The fair value accounting concepts require the companies for writing down the financial assets in order to reflect the plunging values of the market during the financial crisis. There has been several critics which states that the fair value accounting has contributed to excessive credit expansion and pro-cyclical risk factors. Ever increasing global expectations has let the accountants to fill relatively complex roles and challenges which the organizations are facing at present. Some of the more casual factors for the failure in the accounting system and the challenges concerning the same is seen to be discerned in terms of the failure in the corporate governance and several types of the risks associa ted to the same (Geppert, Matten and Williams 2016). Changes in Accounting Standards and role of politics The changes pertaining to the accounting standards is viewed as another aspect of the challenge which is faced by the accountants globally. Some of the important considerations pertaining to the implementation of the new standard is evident in terms of areas such as revenue and leases. The introduction of a new accounting standard may involve identifying contract, determination of the transaction price, identification of the separate obligations pertaining to the contract along with recognizing the revenue and the entities which satisfies with the performance obligations (Ebrahim, Battilana and Mair 2014). The changes in the accounting standard is also seen to impact on the leases which will result in changes in balance sheet. There are number of principles which guides on how these amounts will be recorded. The leases in the balance sheet is considered with an important effect on the leverage ratios. The changes pertaining to the accounting system will also lead to significant amount of the changes in the aforementioned areas (Weng, Jowitt, Mudd and Haque 2015). Changes in business and organizational environment In serval instances it is discerned that the managers fail to anticipate and respond to the changes in the business environment. In cases where managers do not notice the changes in the business environment often lead to such unexpected results. There are studies which shows that managers may be aware of the significant nature of the changes in the organizational environment however they may not be capable to interpret these appropriately. The relationship between the competitive environment and the challenges pertaining to accounting is discerned in form of the industry environments, corporate strategy, organizational structure, business strategies and capabilities. The crucial aspect of the changes in the managerial behavior is depicted with the rapidly changing environment which is considered as a cognitive process in noticing and constructing the meaning of the environmental changes. Empirical evidence has been able to suggest that the managers fail to depict the changes pertaini ng to the organizational environment (Gereffi and Fernandez-Stark 2016). Fair value accounting and its impact on Global Organizations The financial instruments inclusive of derivatives is issued in accordance with the changes in fair value which directly affects the net income and considers the changes pertaining to short span of time. In addition to this, the consideration of fair value accounting is becoming significantly important for fair value accounting which is one of the main reason for becoming crisis in the global organizations. There has been significant amount of research which has implied that the fair value accounting has set specific standards for accounting and used the same in all the related areas. Several evidences of unfair accounting practices have been considered as the main rationale for the challenges to the accountants globally. These are caused in instances where the business seeks assistance on key audit matters from unqualified auditors (Lele 2017). The research hypothesis set for the study are listed below as follows: Null Hypothesis (H0): The main challenge of accounting in global organizations is not seen in terms of changing Role of Management accounts Alternative Hypothesis (H1): The main challenge of accounting in global organizations is seen in terms of changing Role of Management accounts Null Hypothesis (H02): The main challenge of accounting in global organizations is not seen in terms of Financial crisis Alternative Hypothesis (H2): The main challenge of accounting in global organizations is seen in terms of Financial crisis Null Hypothesis (H03): The main challenge of accounting in global organizations is not seen in terms of Changes in Accounting Standards and role of politics Alternative Hypothesis (H3): The main challenge of accounting in global organizations is seen in terms of Changes in Accounting Standards and role of politics Null Hypothesis (H04): The main challenge of accounting in global organizations is not realized in terms of Fair value accounting Alternative Hypothesis (H4): The main challenge of accounting in global organizations is realized in terms of Fair value accounting Qualitative research The qualitative research technique will be implemented as per Narrative research technique. This will include sequence of events taken from one or two individuals. The research will further include in-depth interviews and involve reading of relevant documents. Quantitative research The quantitative research technique will comprise of the collection of the data from the primary and secondary sources and performing regression analysis to test the hypothesis validity. The primary source of the data will include responses will be taken from survey respondents. The important factors taken from the secondary data sources has included relevant books, journals and authorized publications. The analysis tool for quantitative research will be taken into account use of nominal, ordinal, cardinal, ratio and interval scales. Research Limitations The research will be considered as per the limiting factors based on role of Management accounts, Financial crisis and Challenges of Accounting in Global Organizations, Changes in Accounting Standards and role of politics, Changes in business and organizational environment and Fair value accounting and its impact on Global Organizations. Some of the important depictions made from the research has further limited the research aspects with qualitative research such as narrative research technique and regression analysis. Time Schedule Sequential Activities/ Period Week 1 Week 2 Week 3 4 Week 5 6 Research planning and Ideation process Proceeding with Designing of the research Data collection and data sampling Analysis of the data collected Publication process Conclusion The important discussions as per the research will be able to identify the important factors affecting accounting in Global Organizations. The primary factors affecting the companies will be identified with changing role of the management accounts, Financial crisis, Changes in Accounting Standards and role of politics, Changes in business and organizational environment and Fair value accounting. It needs to be further discussed that the that the hypothesis of the research will be discussed as per the aforementioned factors. The application of the research methodology will be implemented based on qualitative research technique such as narrative research and quantitative research with regression analysis. The time schedule has included the activities such as Research planning and Ideation process, Proceeding with Designing of the research, Data collection and data sampling, Analysis of the collected data and Publication process. In addition to this, the research will consider the signi ficant amount of research which has implied that the fair value accounting has set specific standards for accounting and used the same in all the related areas. Several evidences of unfair accounting practices have been the main rationale for the challenges to the accountants globally. References Bebbington, J., Unerman, J. and O'Dwyer, B. eds., 2014.Sustainability accounting and accountability. Routledge. Ebrahim, A., Battilana, J. and Mair, J., 2014. The governance of social enterprises: Mission drift and accountability challenges in hybrid organizations. Research in Organizational Behavior, 34, pp.81-100. Geppert, M., Matten, D. and Williams, K. eds., 2016.Challenges for European management in a global context: Experiences from Britain and Germany. Springer. Gereffi, G. and Fernandez-Stark, K., 2016. Global value chain analysis: a primer. Lele, U.J. ed., 2017.Managing a Global Resource: Challenges of forest conservation and development. Routledge. Weng, Z., Jowitt, S.M., Mudd, G.M. and Haque, N., 2015. A detailed assessment of global rare earth element resources: opportunities and challenges.Economic Geology,110(8), pp.1925-1952.