Contomporary issue in accounting Essay Example | Topics and Well Written Essays - 3500 words

Contomporary issue in accounting - Essay ExampleTherefore, the existence of the manager-stockholder conflict is undeniable and on that point are legal as well as business methods of resolving much(prenominal) conflicts. The range of conflicts may be as simple as the bodily social responsibility of the firm to as complex as ethical issues that come up when the management seeks to defraud or cheat its shareholders outright. An understand of such issues becomes important for all students of management, finance, and even sociology since many corporations of the world have budgets which exceed the budgets of s everyplaceeign nations in the world today. To better understand these issues, real world examples from companies such as Enron, Apple Inc. and GE would be necessary. Of these, the case of Enron stands as a prime example of what disasters can result when the management gives itself and the results it wants to have priority over the shareholders and stakeholders of the company.Enr on had a problem of resourcefulness as described by Welch (2005). Enron was created in 1985 when Kenneth Lays small company named Houston Natural Gas was merged with the fire company of Nebraskan-Northern Natural Gas named InterNorth. The sore entity was named Enron and before this merger, both firms were dealing with the distribution of oil as well as electric energy. They were also mixed with the construction, expansion and the maintenance of power plants, pipelines and other similar energy related infrastructure (Thomas, 2002). Under the new company, Kenneth Lay became the Chief Executive Officer and his vision of the company was quite different from what the shareholders might have wanted at the time.This is because Lay wanted to expand the company rapidly into new markets while creating new markets from scratch as well. Of course a achievementful vision of the CEO would have meant increased value for the shareholders as the stock price would have been maximized and success of the company would have meant job