Question

1. Obtain outside information about Shaw Communications Inc and its industry. Answer the following questions:

a. What are the key economic factors of the telecommunication industry?

b. Where is the company in its business life cycle?

c. What are the five or six most important factors for success in this business?

d. How does this company stand with respect to these factors?

e. What notable accounting considerations are there for companies in this industry?

f. What legal or regulatory matters are of concern?

g. What social matters are of concern?

Answer 1

Shaw Communication Inc. is a Canadian Company which provides telecommunication services like Internet,Telephone,television and Mobile.

What are the key economic factors of the telecommunication industry?

Key Economic Factors of telecommunication Industry-

Today telecommunication is like basic neccessity ,every problem of individuals are solved through internet ,telephones,etc. Every day to day need is fullfilled through internet like if an individual needs food right now he could order it online, If a product is not available in market he could purchase it from Online Store.So, telecommunication is one of the basic neccesity it has a potential of a big business.

Every Business needs a market -consumers, they are the real reason behind the sucess of every product.Some of the Economic Factors of are Interest rates,taxes and Inflation.

Price charts offered to consumer is another key Economic factor - A Rational customer always go for low prices.One of the big challengesof this industry is reaching to the potential customers in small villages and small cities its not easily accessible for people.

Growth in Telecommunication Business depends on the growth of the customers and technology. One of the other reason of growth are the jobs there are Technical staff,Graphic designers,Programmers,Customer Support personnels.

Where is the company in its business life cycle?

Business Cycle also known as Economic Cycleis downward and upward movement of GDP over its long term. The 4 stages of the BLC are-

1. Expansion
2. Maturation
3. Recession
4. Recovery

The GDP growth will be determined through Shaw Comm. Inc.'s ability to pursue its long term Goal. During the current Economic Conditions its Maturation Phase - during thi stage there will be Economic Slow-down, there will be Inflation.

What are the five or six most important factors for success in this business?

1. 1.Market Position- A company with material influence over the  Market can be a Sucessful Company
2. 2.Operating Management-A Company which has an efficient and Effective Personnel can be sucessful in the market as Consumer wants a responsive and responsible company towards their problems and queries.
3. 3.Diversification- Companies must work towards the diversificaton ,it need its product to diversify overseas in diffrent geographical areas.
4. 4.Quality Services- No Rational wants a bad Quality services like Internet Services,Call Dropping,etc; So company must provide Good Quality Services to its Customers
5. 5.Technology Advancement- Technological Advancement is another Factor so that the company could Provide quality Services to its Customers.

How does this company stand with respect to these factors?

Shaw Comm.INC. is a company setup in 1966, its a Company that directly influences the performance of the Economy.Moreover, the business performance of Shaw Communications Inc. is also influenced by the extent to which the host country government has spent on core infrastructure development. A well-developed infrastructure facilitates the business environment and increases the growth potential of the gold industry in the respective country.

What notable accounting considerations are there for companies in this industry?

According to AICPA:

1.Accounting for individual contracts with customers versus Portfolio accounting - This implementation issue discuses considerations for telecommunication entities in determining when it is appropriate to apply ASC 606 on a portfolio or individual contract level.

2.Identification of Separate Performance Obligations in the Contract - This implementation issue discusses considerations for telecommunication and cable industry providers in determining which promises in an agreement represent performance obligations under ASC 606.

3.Accounting for contract modifications - This implementation issue discuses considerations for telecommunication entities in accounting for contract modifications under ASC 606.

What legal or regulatory matters are of concern?

Some of the Regulatory policies Concern for Telecom.industries are:

1. Who will be regulated.
2. What powers will be given to regulators.
3. How Regulatory Powers will be Organised.
4. what procedures needs to be followed .
5. Which level of Govt, will be responsible.

What social matters are of concern?

1. Telecos Decenteralize its power internally and externally.
2. Internet Providers have increased and this is leading to decrease in profit margin of other internet providers.
3. Increase of Financial Overhead due to various services provided
4. Competition among ISP have increased and providing good internet facility is a big target.
5. Customer require Privacy while using these facilities.
6. Customer wants a Healthy Competitions among ISPs.
7. As ISPs are increasing with different plans and offers every Isp needs to provide the services with reasonable rate.etc.