Discuss the content (type of data and files) of a database which could be useful at Accra Institute Technology(AIT).

Is an increased dependence on technology making us less inclined to function independently?

PLEASE be extremely thorough with the answer.

Alpine Perceptions Ltd.

Alpine Perceptions Ltd. (APL) provides “technology solutions” to manufacturing companies. APL is a wholly owned subsidiary of Elevation Technologies Inc. (Elevation), a privately owned conglomerate. In 2016 APL was performing poorly and Elevation considered selling the company for the best offer. As a last resort Elevation hired turnaround specialist Kendal Wilson to more effectively manage and salvage APL. Ms. Wilson’s employment contract specifies that in addition to an annual salary she would receive a $1 million cash bonus after the end of the 2019 fiscal year if APL meets a number of performance goals over the 2017 to 2019 period. For 2017 and 2018 APL achieved the goals. To meet the performance goals for 2019 APL must report net income in excess of $20 million.

It’s now January 25, 2020. APL’s financial statements for the year ended December 31, 2019 have been received at Elevation’s corporate offices. APL’s net income for 2019 is $20,550,000. Elevation’s CFO has examined the financial statements and is satisfied with most aspects of them but is concerned with the reporting of some transactions and economic events. The issues of concern are described below:

1. On May 30, 2019 the company made a payment of $250,000 to a computer hacker who obtained access to the computer code to APL’s proprietary software that is used to produce some of APL’s products. The hacker had given the company ten days to pay or she would sell the information to a competitor. Management believed that if the information was obtained by a competitor it would have significant negative consequences for the company. APL has capitalized the amount of the payment and is amortizing it over the remaining life of the related assets, which is about four years.
2. APL has always shut down for one week in late December for routine maintenance of the company’s equipment. The annual maintenance is essential to ensure that the equipment can meet the precise specifications of customers. For the past three years, maintenance has been completed by the end of December. The annual maintenance originally scheduled for December 2019 was delayed until the first week of January 2020 because of scheduling problems with the company that does the maintenance and because APL had a number of contracts it wanted to complete by the end of December. The last maintenance was done in December 2018. APL paid $425,000 for the January 2020 maintenance work. The amount was paid in mid-January.
3. In October 2019 APL settled a lawsuit by an employee from an incident that occurred in 2015. APL agreed to pay the employee $350,000 and the payment was made on November 12, 2019. APL accounted for the settlement and payment by crediting cash and debiting retained earnings for $350,000. It was explained that since payment pertained to an incident in 2015, income in 2019 shouldn’t be affected.

The CFO has asked you, an accountant in the finance department, to prepare a report evaluating the issues. Ms. Wilson has already called the CFO to arrange a meeting to discuss the financial statements and the payment of the bonus. The CFO wants your report to explain the problem in each issue, identify reasonable alternatives, and provide full support for your recommendations.

Required:

Prepare the report requested by the CFO.

You should prepare a written report. Your report should consider responses to the following questions:

1. What is your role? Who are you reporting to and what are their objectives? (Think carefully about the objectives. Don’t necessarily rush to a conclusion.) How is that person’s objectives affected by accounting information?

2. Who prepared the financial statements? What are the objectives of the preparer? How do the financial statements affect the objectives of the preparer? How do you think the person preparing the financial statements will approach preparation of the statements (given the opportunity to make accounting choices, what kind of choices will he make)? What are the terms of the arrangement that make accounting information important in this situation? What conflicts, if any, are there between the parties? Explain the conflicts.

3. Are there any constraints you must adhere to? Explain why. (ASPE or IFRS)

Alpine Perceptions Ltd.

Alpine Perceptions Ltd. (APL) provides “technology solutions” to manufacturing companies. APL is a wholly owned subsidiary of Elevation Technologies Inc. (Elevation), a privately owned conglomerate. In 2016 APL was performing poorly and Elevation considered selling the company for the best offer. As a last resort Elevation hired turnaround specialist Kendal Wilson to more effectively manage and salvage APL. Ms. Wilson’s employment contract specifies that in addition to an annual salary she would receive a $1 million cash bonus after the end of the 2019 fiscal year if APL meets a number of performance goals over the 2017 to 2019 period. For 2017 and 2018 APL achieved the goals. To meet the performance goals for 2019 APL must report net income in excess of $20 million.

It’s now January 25, 2020. APL’s financial statements for the year ended December 31, 2019 have been received at Elevation’s corporate offices. APL’s net income for 2019 is $20,550,000. Elevation’s CFO has examined the financial statements and is satisfied with most aspects of them but is concerned with the reporting of some transactions and economic events. The issues of concern are described below:

1. On May 30, 2019 the company made a payment of $250,000 to a computer hacker who obtained access to the computer code to APL’s proprietary software that is used to produce some of APL’s products. The hacker had given the company ten days to pay or she would sell the information to a competitor. Management believed that if the information was obtained by a competitor it would have significant negative consequences for the company. APL has capitalized the amount of the payment and is amortizing it over the remaining life of the related assets, which is about four years.
2. APL has always shut down for one week in late December for routine maintenance of the company’s equipment. The annual maintenance is essential to ensure that the equipment can meet the precise specifications of customers. For the past three years, maintenance has been completed by the end of December. The annual maintenance originally scheduled for December 2019 was delayed until the first week of January 2020 because of scheduling problems with the company that does the maintenance and because APL had a number of contracts it wanted to complete by the end of December. The last maintenance was done in December 2018. APL paid $425,000 for the January 2020 maintenance work. The amount was paid in mid-January.
3. In October 2019 APL settled a lawsuit by an employee from an incident that occurred in 2015. APL agreed to pay the employee $350,000 and the payment was made on November 12, 2019. APL accounted for the settlement and payment by crediting cash and debiting retained earnings for $350,000. It was explained that since payment pertained to an incident in 2015, income in 2019 shouldn’t be affected.

The CFO has asked you, an accountant in the finance department, to prepare a report evaluating the issues. Ms. Wilson has already called the CFO to arrange a meeting to discuss the financial statements and the payment of the bonus. The CFO wants your report to explain the problem in each issue, identify reasonable alternatives, and provide full support for your recommendations.

1. For each transaction:
   1. Identify and explain the issue;
   2. Explain the impact of the method the preparer used to account for the transaction or economic event (how does the accounting for each issue affect the parties involved).
   3. Evaluate the accounting used for each issue. Do you think it’s appropriate (explain why or why not)? (To do this you need to apply your knowledge— definitions of elements, etc.).
   4. Is there a better (more appropriate, different) treatment that could be used for the transaction? If there is a better alternative, provide support. Support means referring to appropriate criteria, definitions, standards, etc. as well as to the facts defining the transaction/economic event. If the treatment currently used is appropriate, explain why. When thinking about the existing and alternative accounting treatments, be sure to keep in mind the interests of your client.
   5. Calculate/ (State) the impact of any changes you propose.
   6. Make a recommendation.

Nominal GDP was $21,329.8 billion in Q2 of 2019 and fell to $19,520.1 billion in Q2 in 2020. Real GDP was $19,020.6 for Q2 in 2019 and $17,302.5 for Q2 in 2020, where 2012 was the base year. Compute the percentage change in the GDP deflator during this period.

The senior management of SFU and UBC were deeply concerned about the enrollment for Fall 2020 in March because of the pandemic. However, it turned that the enrollment went up by 5 – 10% for Fall 2020. Please explain this phenomenon using concepts from this course.  

Haaland Company depreciates an asset with an original cost of $8,000 over 5 years using the sum-of-the-years digits’ method of depreciation. The asset was purchased on July 1, 2020 and the depreciation expense for 2020 is $1,250. What is the estimated salvage value of the asset?

Action Items

1. Read the article below: Information Systems and Internal Control.
2. Write: Develop a bulleted list of five to seven (5-7) issues or best practices that you identified based on your reading of this article and how it may impact you while performing in an accounting position.

Information Systems and Internal Control.:

G1.05 Functions That Benefit from IS

Functions that benefit from IS have increased remarkably from the simple military and government uses in the early years. Computers are used to process accounting and financial information of all types. It is not unusual to find entities whose financial records exist only in machine-readable form. Hence, financial statements, general ledgers, and original entry records (e.g., payroll registers, cash receipts, and disbursements journals) are all computerized. Most of these used to be processed in a batch mode, meaning that all homogeneous transactions were grouped together in batches that were submitted to the data center, which then set up and processed the data according to applicable instructions. Most applications have since been converted to the faster, cheaper, and more useful online processing mode involving networks and applications that take advantage of databases and object-oriented software.

While the applicability of computers to financial information has been substantial, the ultimate worth of the computer to management goes far beyond finance functions. In fact, advances in computer technology are usually adopted first by the scientific and technical community. Thus, unique applications that employ some or all advances described are being used for such diverse fields as medical science, nuclear physics, aerospace, computer technology, semiconductors, and telecommunications. Products that feature three-dimensional design capability, imaging, graphics, and simulation offer researchers, designers, and engineers powerful and flexible tools to speed creative processes and make them more reliable.

Functions outside the laboratory have also enjoyed the advantages of advanced computer technology. Manufacturing is a good example. Computer-integrated manufacturing (CIM), a concept that has gained in popularity, represents the ultimate goal of many companies: to achieve a totally automated factory environment in which such functions as engineering, purchasing, manufacturing, and quality control are integrated, through online database-oriented systems, such as MRP II (discussed in Chapter F3 ). The automation of CIM transcends MRP II to encompass submanufacturing applications, such as scheduling, process planning, manufacturing cell control, and maintenance. CIM also incorporates the innovation of using EDI to extend electronic links beyond the company to include major suppliers.

Chapter F6 describes how marketing data warehouses are being developed to enhance the reliability and success of marketing strategies. Some of these involve the use of expert systems, which managements use to check the effectiveness of sales promotions and inducements, sales force compensation, pricing strategies, and marketing forecasting and targeting techniques. The integrated databases that form the nucleus of marketing information systems are becoming strategic assets that give companies a competitive advantage.

Competitive advantage is the aim of companies everywhere as they apply advanced systems technology. For example, companies in the retail industry are perfecting point-of-sale systems and sophisticated electronic storefronts; in the oil and gas industry, the major companies are applying expert systems to the challenges of geological analysis, process control, and chemical spills; life insurers are reducing file storage through electronic filing and are using computers and telecommunications to improve links with agents; electronics companies are designing products, such as computers, by using workstations united through LANs and WANs; and in the banking and finance arena, companies are using advanced systems technologies to speed transaction processing and to improve documentation management.⁴

The application of advanced IS technology is notable, but less dramatic for traditional accounting systems, such as payrolls, general ledgers, cost ledgers, fixed assets, accounts receivable, and accounts payable processing. Although more modern products are available, many companies are still using systems designed in the 1980s to perform these functions. A high percentage of these require inordinate support from IS departments to keep them running, are difficult to change, and are poorly documented. During the late 1980s, the opportunity for change grew in earnest. Independent software developers successfully designed software packages to permit real-time data entry and editing and updating of certain files, and to allow interactive query and reporting capabilities. Those systems also offered enhanced control and auditing features that home-grown systems frequently lacked. In the 1990s, this trend continued, with centralized systems being totally rewritten and deployed across decentralized platforms.

Government units are striving to take advantage of advancing systems technology to streamline their operations. Examples of this include the SEC's electronic data gathering, analysis, and retrieval system, more familiarly known as EDGAR. Since 1996, all companies have been required to use EDGAR in the electronic filing of required SEC reports. The IRS continues to encourage the electronic filing of income tax returns, and, in the Department of Defense, disbursing offices continue to enable the electronic handling of billings and payments through EDI.

To support the IS needs of business and government, a multi-billion-dollar industry has evolved, consisting of manufacturers of very large mainframe computers; sophisticated network equipment, virtualized servers that rival mainframes in their sheer computing power, and a host of desktops, laptops, and mobile computing devices that place state-of-the-art computing power in the palm of one's hand. The advent of affordable computing, combined with the universal availability of the Internet, has further accelerated both the revolution in IS and the decentralization of IS capability and responsibility.