Family Law - Final Proposal Essay Example | Topics and Well Written Essays - 2250 words

Family Law - Final Proposal - Essay Example Recently, the Family Law Act, 1996 is a plus to this development of personal law in Britain, particularly in the field of divorce. The Family Law Act, 1996 enacted in Britain with a view to give effect in matters relating to divorce represents some issues that deserve proper explanation. So, reasonably, in this regard the issues to be explained may be stated in this study: The Purpose of the present study is mainly centred on some specific issues. The Researcher intends to make a thorough study over the deficiencies reflected in the present law of divorce; divorce law reforms attempted in the Family Law Act, 1996. By this effort, the Researcher aims at exploring the defects posed in the present divorce legislation. Consequently, the Researcher would be very much capable to keenly single out the impediments in effectively implementing the divorce law of England. Pertinently, the Researcher would be able to recommend some eclectic and viable suggestions and guidelines that would ensure a paradigm-breaking change in the current divorce legislation in England. As a result, it would make the avenue in introducing a new divorce regime in England that is very much fit to adjust with the changing circumstances in 21st century in England. With the emergence of urbanization and process of development human life has become complex. People are being riddled with multifarious complicacies. For this, social disorganization has been the common phenomenon that is severely causing the normal upgrowing of balanced human conduct. As our interest is mainly attributed to divorce legislation, proper clarification i.e. specifying and defining the terms Divorce and Divorce Proceedings is essential. Divorce means dissolving the marital relationship. So, divorce proceeding imply the proceeding that is undertaken with a view to dissolve the marital relationship or end the conjugal ties. The growth in lone parent families, the prevalence of divorce and remarriage, and alternative ways of managing intimate relationships (such as cohabitation and 'living apart together') have eroded the normative purchase of marriage and the nuclear family (Dey & Wasoff, 2006). It is needless to say that the consequences of family break-down are jeopardizing the social cohesion. Frustration and social disorder are causing serious effects on the human conduct and social regulation. In fact, the development of divorce law is a continuous effort since 1857. As an inseparable part of this undertaking, the relevant enactments are the Marriage Act, 1949 and the Matrimonial Causes Act, 1973 are of special mention. Recently, the enactment of the Family Law Act, 1996 is the way of root to this development. The provisions as set out in those statutes put emphasis on preserving the interests of both parties so that none can be affected. It also stresses on mediation, welfare of the children, provisions escaping the financial hardship of either parties. Though the recent enactment the Family Law Act, 1996 is considered as a significant enactment, it lacks certain shortcomings. As a result, the divorce reform attempts introduced in the said enactments has been proved fu tile and unfructuous that has been rigorously produced in our study. 4. CRITICAL ANALYSIS The Family Law Act,

Challenges of the Twenty-Year Veteran Seeking Federal Employment Research Proposal

Challenges of the Twenty-Year Veteran Seeking Federal Employment - Research Proposal Example The paper tells that the Federal Executive branch has been recognized to be the principal owner with regard to Veteran employees in the United States. A huge number of Veterans are believed to be engaged presently in different agencies throughout the country as well as the world. The Federal government is learnt to comprise augmented number of Veterans as its employees in comparison to the other private segments. It has been further found that the Federal government even plans to increase its recruitment of Veterans in the various fields of services. Employing Veterans by the government is not only considered to be morally appropriate but is also believed to be advantageous from the business point of view. It is considered to be quite beneficial as the government is often believed to put in noteworthy amount of resources for the reason of training as well as development with regard to the military service workforce. The insistent steps taken towards keeping hold of the evolutionary m ilitary service workforce within the government aid in making the most of their return on the made investments. This also facilitates the government to make recruitments and fill up the places that entails higher requirements in the Federal agencies. The twenty-year veterans’ were found to witness challenges while seeking federal employment after the completion of their service in the armed forces. This is proving to be discouraging for the twenty-year veterans’ as they are being held back from leading a normal life post service. The main challenges faced by the twenty-year veterans’ along with the causes are considered to be the problem which is aimed to be explored in this study. Purpose Statement The purpose of this study will be to focus on the various challenges faced by the twenty-year veterans while seeking federal employment. The study will also intent to identify the causes triggering the challenges along with suggesting suitable solutions. Conceptual T heoretical Framework The aim of this research will be to identify the challenges faced by the twenty-year veterans while looking for federal employment. The research will relate to the laws favoring the appointment of twenty-year veterans’ in federal employment and the other relevant laws related to the preference and disabilities along with the needed steps that is required to be undertaken in this context. Research Questions The research questions in relation to the topic of the research identified are: The kind of challenges witnessed by the veterans’ The role of the Veterans’ Preference Laws in overcoming the challenges Literature Review From the time period with regard to the Civil War, considerable extents of preference in the course of selection in relation to the Federal jobs are being provided to the Veterans related to the Armed Forces. Taking into consideration the degree of sacrifices made with regard to those individuals offering their services in t he field of Armed Forces, the Congress passed laws with the intention to avoid or check veterans on the lookout for Federal service from being reprimanded owing to the amount of time spent by an individual in the field of military service (Howell, 2011). According to the regulations, the physically disabled veterans or the ones who rendered their respective service in relation to dynamic responsibility with regard to the Armed Forces in the course of definite particular time phases or even in military movements would enjoy certain

Capitalizing Human Resources In Company Management Essay

Capitalizing Human Resources In Company Management Essay Since the intellectual capital has gradually transformed into one of the most important assets valued by the companies, the system of the applicable accounting practices that refers to human resource capitalization is subject to thorough research (Guthrie, 2001). In 2003 Ken Lewis, HR Director of Co-operative Financial Services made the following statement: We believe that measuring and reporting on the contribution of our people to the business provides a tremendous opportunity to share and enshrine best practice, improving the competitiveness and performance of UK business in both national and global markets (cited in Accounting for People, 2003, p.21). The research paper outlines and analyzes the pros and cons of capitalizing human resources (HR) through human resource accounting in companys financial statements. The importance of HR capitalization The rapid development of corporate sector (in particular service-oriented companies) in the well-developed economies of the world within the conditions of the knowledge economy of the 21st century has necessitated the reconsideration of the applicable accounting practices, policies and procedures. In particular, human capital and its intellectual potential are considered as the core assets of the service companies. Many companies owe their successes, profitability and competitive advantages namely to the quality of their HR performance (Brooking, 1996). Thus, to a large extent, the successfulness of most of the service companies in almost every industry directly depends on the quality of staff they hire, retain and develop. Much of the corporate investment therefore is directed to the staff training and empowerment to ensure the high level of both individual and team performance within a company (Robbins, 2001). Many studies have so far shown that particularly service companies that capitalize their human assets are better valued in terms of return on investment thereon. In particular, the expenditures of quoted service companies on their human resources (including staff selection, recruitment, education, training, welfare, subsistence allowance and pension fund contributions etc) are better accounted for providing they are capitalized. Thus, most of the studies recommend the companies to capitalize their human resources and report all their human resource expenditures which improve the productivity and quality of companys performance (Edvinsson and Malone, 1997). Proper HR management and HR capitalization in particular are important within the gradual transformation towards the knowledge-based economy which requires the transparency of inner corporate procedures and processes that relate to the accounting of companys assets. Since the knowledge-based economies are mainly dominated by the service-oriented companies, their major assets are knowledge, skills, expertise and talented and dedicated workers capable to improve companys performance. Since HR investment enhance service companies competitive advantage, the expenditures on HR account for more than 50% of their revenues (Guthrie, 2001). The accounting of the human capital should therefore be recognized and applied in the financial reports. In accordance with the traditionally applied accounting procedures, all expenditures related to the advancement of HR intellectual development are considered as an expense (Newman, 1999). Such approach erroneously regards HR contributions as unimportant beyond the current period assuming that individual knowledge and skills cannot benefit a company in the future (Steffy and Maurer, 1988). Human Resource Accounting (HRA) as a relevant approach to HE capitalization Over the recent years the corporate sector has evidenced the introduction and development of the innovative concept referred to as Human Resource Accounting (HRA). This is largely because companies pay particular attention to their HR and perceive this intangible asset as the core factor that directly impacts their performance, profit-making and competitiveness. HRA has forever transformed the traditional approaches of the financial accounting to the value of human resources. The HR capitalization is therefore made by means of HRA which values and report HR as revenue expenditure charged to the direct costs that are incurred as a capital expenditure. Primarily, HRA identifies and reports the capital invested by companies in their HR that are currently not accounted by the traditional accounting practices. Therefore, non-traditional Human Resource Accounting (HRA) approach has been widely applied within the corporate environment to emphasize on the recognition of human resources and t he capitalization of this asset. By and large, HRA stands for the process of attributing monetary (tangible) value to human resources and its recognition as an asset in the corporate financial statements. The application of HRA in the modern corporate practice is mainly driven by the shift of HR management towards the empowerment of employees knowledge and skills. In fact, many companies value their human resources more compared to the other assets they possess since they deem that competent and dedicated individual and team performance is the key to companys success and profitability (Guthrie, 2001). Taking this into account, Kodwani and Tiwari (2007) state that contrary to traditional accounting practice, HRA is the relevant framework that objectively identifies, capitalizes, and reports the expenditure spent on HR. HRA advantages As one of the newest accounting techniques, HRA extends the traditionally applied accounting principles that match the revenues and costs to quantify the value of HR and help corporate management achieve the required equilibrium with regard to HR practices. In particular, HRA benefits corporate management, employees and financial analysts by: (1) Utilizing and planning HR as an asset; (2) Distributing available resources required for HR transfer, training, retrenchment, and promotion; (3) Evaluating the costs incurred for the training sessions for HR and the potential benefits they will bring a company; (4) Enabling low return on investment, including thee improper utilization of HR; (5) Preventing high levels of absenteeism and turnover at the workplace; (6) Assisting investors concerned about making long-term investments in companys business; (7) Comprehending and assessing the inner working environment and the potential of corporate management; (8) Improving HR individual and team performance and the bargaining power of HR; (9) Creating proper background for the effective and relevant management decisions about hiring, maintain and developing HR that would help a company reach its strategic goals; (10) Making each single employee understand their individual role and contribution in the advancement of expenditure incurred by a company; (11) Monitoring the process of HR management; (12) Aiding corporate management and the decision-making processes to further advance companys financial practices; and (12) Analyzing the appreciating human capital in a company (Roslender, 2004). HRA disadvantages On the other hand, many companies oppose HR capitalization. This is mainly due to the fact that HRA is the system that combines accounting techniques and methods that are aimed to assist personnel management while valuating knowledge, skills and potential of HR as well as their motivation to serve the corporate goals in a dedicated manner. From the financial perspective, this indicates that many companies perceive their employees as liability rather than HR. Indeed, there are various limitations which deter corporate management from introduce HRA in many companies. The apparent disadvantages of HR capitalization through HRA are as follows: (1) Absence of clear guidelines and procedures that regulate the allocation of costs required to capitalize HR in a company; (2) Impossibility of adequate HR valuation due to the uncertainty of HR existence within a company (this drawback is explained by high levels of turnover in many companies which makes it impossible to define long-term HR strategies for the future periods of a companys operation); (3) Currently applicable HR capitalization systems are featured by numerous drawbacks; (4) HR are not physical assets and therefore cannot be utilized, owned or retained; therefore corporate management in many companies fails to treat HR as definite asset (for instance, tax legislation does not recognize HR as assets); (5) Lack of empirical evidence of HRA effectiveness as a management tool applied to facilitate HR management; (6) Trade unions fear that HR capitalization will make employees demand additional compensation and rewards in line with HRA valuations; and finally (7) HR capitalization is not a subject to the universally accepted approach, and this fact alone makes its empirical implementation rather complicated. The abovementioned drawbacks prove that the current practice of accounting cannot place value on knowledge, skills and employee capabilities as they are regarded as intangible assets (Robbins, 2001). Conclusion The research has evidenced that the overwhelming majority of competitive service-oriented companies regard HR as their major asset. The nature of HR investment assumes that the core features of human capital require companies to capitalize them. Such a necessity is explained due the impact of the investment on the individual performance of the employees which can potentially benefit a companys overall success during the future accounting periods (Guthrie, 2001). Overall, service companies are better valued providing that their HR values are recognized through the capitalization of the relevant investments (Edvinsson and Malone, 1997). The spotted drawbacks of HRA, however, evidence that currently there are many procedural complications related to the HR capitalization which make many companies reject this accounting approach. Nonetheless, the findings of the recent empirical studies suggest that the quoted service companies should acquire HR capitalization methods and report their HR expenditures which improve the productivity and quality of their performance. Therefore, HR capitalization is indispensable and important component of corporate competitiveness as it benefits companies market capitalization and share prices (Adams and Roberts, 1993).

Use of Angels in Smith’s Annunciation and Plath’s Black Rook in Rainy W

Use of Angels in Smith’s Annunciation and Plath’s Black Rook in Rainy Weather  Ã‚   Since biblical times, people have looked to angels as sources of comfort, inspiration, protection, and solace. Yet very little is said in the Bible about what angels actually are; the Bible focuses mainly on their deeds, and leaves their nature to the imagination. Consequently, few people really understand them, and the very notion of angels is a rather open-ended idea subject to personal interpretation and design. Poets, never ones to let a chance at interpretation go by, have written about angels, using them as both subject and metaphor. Two poems of note where angels are used as metaphors are "Annunciation", by Kay Smith and "Black Rook in Rainy Weather", by Sylvia Plath. In these poems, angels are referenced not for their own sake, but rather for the metaphorical meanings which the reader may glean from them. In "Annunciation", Smith uses an angel to represent greatness left pursued yet unattained a life, while Plath uses angels to represent unusual occurences which brighten or a dd meaning to an otherwise dreary life. "Annunciation" begins with a note about the standard artistic depiction of the Annunciation, in which the angel Gabriel appears to the Virgin Mary to declare that she will be the Mother of God. Smith notes that in paintings of the event, Mary is always reading a book; she seems trying to keep her place in the book, despite the arrival and great presence of Gabriel. In the poem, Smith herself paints a portrait of a young girl at a crossroads: two girls at a museum in Italy on some sort of trip. "We two sometimes women" (line 20) implies that the girls are fairly young, but since they seem to be alone together they have likel... ...vene in the lives of the faithful in times of trial. Plath uses angels as a metaphor for strength and hope in a time of darkness. Angels are so commonly felt but poorly understood that it is possible to attach many different meanings to them. In poetry, angels can represent a spectrum of ideas and feelings, from awe to hope to strength to fear, just to list a few examples. In "Annunciation", Kay Smith uses the majesty and biblical significance of the angel Gabriel to represent a feeling of greatness and destiny that the speaker let slip through her grasp. In "Black Rook in Rainy Weather", Sylvia Plath uses angels to symbolize the brightness and hope that make an otherwise bleak and dreary life livable. Clearly, angels, like our lives themselves, can have whatever meaning we choose endow upon them. "In the arms of the angels, may you find some comfort here."

Ethics Position Paper

Ethics Position Paper Q575 – Dr. Elliot June 7, 2010 University of Phoenix Introduction Today, people can make decisions that can have a profoundly positive or negative effect on their family, their employer, coworkers, a nation, and even on the entire world. The life we lead whether professional or personal reflects the strength of a single trait: our personal character. Ethics are different for each person both on a professional and personal level. For the most part, people want to be known as a good person, someone who can be trusted, and that he or she is concerned about his or her relationships and personal reputations. I therefore conclude that professional ethics are indeed influenced by personal ethics and values. Although professional ethics guidelines are provided by our government (federal and local), employer and education, personal values and ethics are also considered at the same time. What are Ethics? Let’s begin with the definition of ethics. Ethics can be defined with more than one meaning based upon the context and subject it is being used. In philosophy, ethics is the study and evaluation of human conduct in the light of moral principles. Moral principles may be viewed either as the standard of conduct that individuals have constructed for themselves or as the body of obligations and duties that a particular society requires of its members. A second definition or meaning of ethics is motivation-based on ideas of right and wrong. Portman defines ethics as â€Å"standards of conduct, standards that indicate how one should behave based on moral duties and virtues, which themselves are derived from principles of right and wrong. In order to apply this definition to practical decision making it is necessary to specify the nature of the moral obligations considered intrinsic to ethical behavior† (http://sun. menloschool. org/~sportman/ethics/definition. html). I agree with this definition in fact I believe that ethics are different for every person due to personal values and experiences. There are general ethics that most people adhere to because of the societal mores and morals we all have been exposed to and abide by. There are also other morals and mores that are picked up along the way that vary between people because of cultures, communities, families, heredity etc. I feel that I may not look at the same situation or case the same as another person and we may never agree upon the same methods to go about resolving an issue. This occurs because we all have differences of opinions and value systems. For example, I have nothing against people who are gay I just do not encourage nor discourage the behavior; I allow others to live their lives according to what is best for them. The same goes with ethics. Although my job may say I must intervene in a situation but my own personal ethics prevent me from acting professionally because I feel people should be allowed to live and learn. Overall, ethics and ethical positions will vary from researcher to researcher because they do not have all of the same goals nor do they see things in the â€Å"same light†. Ethics in Educational Research Although I think that ethics vary between individuals I believe that professional ethics are important in protecting those participants of research. I do not think that research should be based on the personal interests of the researcher but I think every person has a level of discernment that should be used especially when other lives are involved. General ethics play a huge role in education because first education is where ethics are taught. After learning about ethics students can then analyze the ethics they can identify and it soon becomes apparent that ethics are involved in most life situations. As future teacher honesty would be my biggest ethical commitment. I choose honesty because with today’s technology and increased use of online educational institutions, people can copy and paste whatever they need in order to be successful. Student’s academic honesty will help me to give them the accurate grade they deserve and not have to punish students who are caught cheating/plagiarizing information. Ethics also keep researchers from publishing false information and also prevent them from being lazy about the research. Mainly it protects the participants of research and also protects the researcher from being accused of unethical practice if they indeed follow those practices. Ethics and Today I recently heard a report on the news that the World Health Organization is being accused of over exaggerating the Swine flu pandemic. When I first heard about Swine flu I believed that is was a scare tactic in order to get people to get those shots. WHO performed unethically in my opinion however they believe that many people died from this disease and the swine flu should not be minimized. Ethics today are still very important especially when other people’s lives are involved. While some people find it easy to break ethical standards others follow the guidelines and remain neutral. The swine flu pandemic created worried people and families going in masses to get the vaccine. Today we still need ethics because not every has the best interest of others when conducting research. Federal standards require research to abide by ethical standards. It is up to each individual to utilize those standards and incorporate them into personal values that may influence society later. Conclusion Ethics vary from person to person due to the differences in values and cultural backgrounds and even education. We do not all interpret information the same way and therefore will not be able to apply the same amount or ethics in any given situation. Furthermore professional and personal ethics affect each other depending upon the specific situation being researched. Also every subject will yield a different set of ethics and values. Therefore ethics are not only subjective in content but objective in nature. References McMillan, J. , & Schmacher, S. (2006). Ch. 6 Ethical and Legal Considerations. Research in Education: Evidence-Based Inquiry, Sixth Edition, Pearson Education, Inc. McMillan, J. , & Schmacher, S. (2006). Ch. 12 Research Ethics: Roles and Reciprocity. Research in Education: Evidence-Based Inquiry, Sixth Edition, Pearson Education, Inc. Portman, S. (unknown). What are ethics? Retrieved from http://sun. menloschool. org/~sportman/ethics/definition. html

Impossibility of Auditor Independence

The Impossibility of Auditor Independence Intentional collusion of auditors and their clients is is not the major cause of Audit integrity. Most of the times, auditors find it difficult to become objective. In 1992, Phar-Mor, Inc. drugstore in the United States seeking a court protection from corruption failed a court case. The previous auditors, Coopers & Lybrand, Phar-Mor's failed to state inventory inflation and manipulation of finanicial that lead to overstating of $985 million earnings in a period of three years. The judges found Coopers ; Lybrand answerable for fraud to the joint investors.The attorney for one investor argued that â€Å"this sends a strong signal to the accounting community that investors take very seriously the role of audited financial statements and rely on them for their integrity. â€Å"‘ The investors who successfully sued Coopers & Lybrand contended that Gregory Finerty, the Coopers & Lybrand partner in charge of the Phar-Mor audit, was â€Å"hu ngry for business because he had been passed over for additional profit-sharing in 1988 for failing to sell enough of the firm's services. â€Å"‘ Analysist, argue that Independence of audit was hindered by relationship with the management.Unjustified certification of financial statement like The Phar-Mor case are of many cases where auditors have been held responsible. Investors in the MiniScribe Corporation maintained that auditors were at least partially responsible for the now-defunct company's falsified financial statements; at least one jury agreed, holding the auditors liable to investors for $200 million. In the U. S. financial reporting of savings and loan crisis has led to lose of millions of dollars by audit firms settling lawsuits and out-court suits making them collapse.The accounting profession claim that plaintiffs unjust actions are aimed looking for a convenient â€Å"deep pocket† towards recovery of their unplanned business decisions. The accounting p rofession’s role in financial reporting has experienced low reputation by investors and lenders. How could auditors not see that so many of their savings and loan clients were about to fail? How could a prominent auditing firm with a reputation for integrity overlook such large misstatements in Phar-Max H. Bazerman is the J. Jay Cerber Distinguished Professor of Dispute Resolution and Organizations at the J.L. Kellogg Graduate School of Management, Northwestern University. Kimberly P. Morgan is a certified public accountant and a Ph. D. candidate at the Katz School of Business, University of Pittsburgh. Ceorge F. Loewenstein is professor of economics, department of social and decision sciences, Carnegie Mellon University. First, the auditor-client relationship greatly influences opinions made about financial statement by auditors . Even the most professional auditors find it almost inevitable to maintain independence with the current audit procedures.Imagine situation where p rofessionals deliberate their duty without prejudice at all times. For example doctors treating patients without expecting salary. Teachers in schools guiding learners selflessly. However, teachers, doctors or judges are motivated by their own gains making them vulnerable to impartial judgments and not necessarily corrupt. Auditing mandated to provide direction to shareholders and stakeholders posses big losses in case it fails to detect malpractice in financial statements preparation. The management hire, mandates and even suck auditors.Therefore, auditors serve the interests of their employer hence seem bias. The American Institute of Certified Public Accountants (AICPA) states in its Code of Professional Ethics: â€Å"In the performance of any professional service, a member shall maintain integrity, shall be free of conflicts of interest, and shall not knowingly misrepresent facts or subordinate his or her judgment to others. . . . Members should accept the obligation to act in a way that will serve the public interest, honor the public trust, and demonstrate commitment to professionalism. ‘ The code of ethics acknowledges to some extent compromise on integrity and objectivity of the profession. Several parties including stakeholders, business advisors, lenders and financial institutions depend on financial statements to aid in their decision making. The management strives to maintain the reputation of the company. However, temptation to give over-ambition plans and objectives drive the management to give false information about the financial position of the company. This serves to attract external potential customers and takeholders. Financial reporting suffers from unqualified auditors. Reliability, accuracy and objectivity matter a lot in financial statements. Financial statements investigation requires generally accepted standards in accordance with International Standards of Auditing. Unqualified auditors usually communicate wrong presentations about the truth and fairness of accounting. Furthermore, independence cannot be possible in intellectually. Normally, misstatements occur during presentation as auditors interpret the data.Accidentally, false judgment enters the audit reporting without conscience. In the process of reporting and analyzing financial statements false information may be relayed as well. One’s role in presentation of information plays a vital role in terms perception, interests and preference. This subjective factors manipulate facts altering fairness and justice. Inaccurate interpretation of data leads to misleading conclusions. People fall into the trap of distinguishing between personal interests and morality.The rewards participants get in the exercise expose them to difficulty in liberating themselves from bias. In many circumstances, auditors consider the people who might be hurt by their independent opinion on the financial statement. The potential people to be affected by the report may b e close associates with the audit. This may make them give false verdict about the fairness of the statements. On the other hand pointing misstatement ruins close relationships and in the event lose friends, contract and employment.Auditors reappointed periodically get used to the company’s mediocre in preparation of financial statements. In the event auditors ignore small errors and frauds in the institution. Auditor often adjusts statements reporting. People mislead to rationalize a judgment that is consistent with their own interest. People justify their inaccuracy and one sided judgment about balances through manipulation of data. Serious sanctions and even hefty charges may result. On the contrary, emerging trends auditing promotes independence in the current world.First, competitiveness increase in audit firms. Also dire results of losing a client and increased advantages of cordial relations with the client. Competitiveness Previously, junior auditors basic wage rate w ere at a ratio of four times the cost of the employee. Nowadays when a firm engages in corrupt reporting this amount may fall. In highly competitive markets, audit firms often accept losses audit fees in the initial years in order to â€Å"buy† the company. The client may be retained for a longer period by accepting heavily discounted fees.In the current period audit firms treat clients with great regard. Today, clients can be lured intensified competition among audit firms takes place within and without. These rules of audit business and implications in market share determine profits and even effects of losing a client in a negative audit. . Second, big partnerships such as tax and consulting firms grow rapidly due to audit. Not only do the auditing profession generate profit but also serves as a consultancy agency. In many cases, a Firm's audit client gets consultancy services from the same firm.Notably, the consulting client benefits a lot from the consultancy than from th e audit. Therefore, the views about the accounts also poses a risk on the consultancy service. On the same vein, the integrity of the reporting can be at risk too. Actually, involvement in both consultancy and audit further posses questions on whom the auditor is accountable to and working For. Focused on the obvious conflict of fulfilling responsibility to external users versus the financial benefits of pleasing the client.This conflict is typically viewed as a moral trade-of f on the auditors Face. The larger problem, however, is not with the auditors' morality, but with limitations in the way that they process information. Thus independence remains a problem For even the most moral, honest auditor. Despite the auditors' best efforts to place the external users' interests For the above the client's and to maintain objectivity, they may be unable to overcome cognitive or psychological biases that make them arrive at marginal decisions in the client's favor.The larger problem facing society is that there is good reason to believe that auditors will unknowingly misrepresent facts and will unknowingly subordinate their judgment due to cognitive limitations. While audits are done for external criitics, the negotiated relationship between the auditor and the client creates them. Both the auditor and the client benefit From auditors' self-serving bias. We believe that the auditing profession and external users of financial statements should actively seek fundamental changes in the current structure of the auditing relationship.Observers of the profession have suggested various possibilities, such as prohibiting a firm that conducts a company's audit from simultaneously providing other services for that client, prohibiting audit Firms From providing any related services, having external bodies appoint auditors or set fee structures, requiring companies to periodically change auditors, increasing oversight of auditing practices, or, the most drastic, having governmen tal agencies rather than the private sector conduct audits.While we do not know that any of these suggestions would be optimal, we believe we have made a convincing case for reform of the current auditing relationship. External users pay a huge price for the flaws in the current structure of audit. Work cited 1. Adapted from M. Murray, â€Å"Coopers & Lybrand Is Found Liable by Jury to Investors,† Wall Street Journal, 15 February 1996, p. A-8. 2. Adapted from M. Pitz, â€Å"J'-‘O' Finds Phar-Mor s Auditors Negligent,† Pittsburgh Post-Cazette, 15 February 1996, pp. A1-A6. 3. American Institute of Certified Public Accountants Code of Professional Ethics, 1988. 4. W . Burger, U. S.Supreme Court: 1984, United States v. Arthur Young & Co. , US Supreme Court Reports, IG April 1984, 79 L Ed 2d, 826-838. 5. J. C. Robertson, /! W/>/>/g-(Homewood, Illinois: Irwin, 1990). 6. E. Waples and M. K. Shaub, â€Å"Establishing an Ethic of Accounting,† Joumalof Business Ethi cs, volume 10, 1991, pp. 385-393. 7. C. E. Jordan and J. G. Johnston, â€Å"Auditor s Independence: A Proposal to the Profession and the Public,† The Woman CPA, volume 49, July 1987, pp. 3-9. 8. D. M. Messick and K. P. Sentis, â€Å"Fairness and Preference,† Journal of Experimental Social Psychologf, volume 15, 1979, pp. AMi-A'iA. 9. K. A.Diekmann, S. M. Samuels, L. Ross, and M. H . Bazerman, â€Å"Self-interest and Fairness in Problems of Resource Allocation,†/O; »7M/ of Personality and Social Psychology (in press). 10. D. M. Messick, â€Å"Equality, Fairness, and Social Conflict,† Social Justice Research, voune 8, 1995, pp. 153-173; and D. M. Messick and A. E. Tenbrunsel, eds.. Codes of Conduct {New York: Russell Sage Foundation, 1996). 11. L. Thompson and C . Loewenstein, â€Å"Egocentric Interpretations of Fairness and Interpersonal Conflict,† Organizational Behavior and Human Decision Processes, volume 51,1992 , pp. 176-197; C . Loewenstein, S. IssacharofF, C.Camerer, and L. Babcock, â€Å"Self- Serving Assessments of Fairness and Pretrial Bargaining,† Journal of Legal Studies, oV vtll, 1993, pp. 135-159; L. Babcock, G. Loewenstein, S. Issacharoff, and C. Camerer, â€Å"Biased Judgments of Fairness in Bargaining,† American Economic Review, volume 85, December 1995, pp. 1337-1342. 12. K. Jenni and G. Loewenstein, â€Å"Explaining the Identifiable Victim Effect,† Journal of Risk and Uncertainty (forthcoming, 1997); D. M. Messick, and M. H . Bazerman, â€Å"Ethical Leadership and the Psychology of Decision Making,† Sloan Management Review, volume 37, Winter 1996, pp. 9-22; and L. Babcock and G.Loewenstein, â€Å"Explaining Bargaining Impasse: Th e Role of Self-Serving Biases,† Journal of Economic Perspectives (in press). 13. SeeG. Loewenstein andj . Elster, Choiceove>- 7/>H(? (New York: Russell Sage Foundation Press, 1992); G. Loewenstein, â€Å"Behavioral Decision Theory and Business E thics: Skewed Ttade-offs between Self and Other,† in Messick and Tenbrunsel (1996). 14. See J. C. Corless, R. W. Bardett, and R. J. Seglund, â€Å"Psychological Factors Affecting Auditor Independence,† The Ohio CPA Journal, volume 49, Spring 1990, pp. 5-9. Reprint 3848 94 BAZEHMAN ET AI,. SLOAN MANAGEMEN T REVIKW/SUMME R 1997