Anishinabe Social Issues Essay Example | Topics and Well Written Essays - 1250 words

Anishinabe Social Issues - Essay Example Being a tribe they had to overcome poverty, discrimination, and invasion and family biases to claim their identity. However, they still face some social issues as a minority in American society and they can be as below. Threat to culture and language – Being an older tribe of Northern America, the community find it difficult to preserve their culture and language. They were people living in natural environment and had spiritual beliefs. Since the invasion of Whites, the Anishinabe culture has been threatened. First they had to leave their homeland and then slowly they had to adapt the culture of Americans. They were alienating from the ancestral cultural beliefs and rituals and slowly became multi – cultural. Now the tribe is one the verge of assimilating to the American culture and losing their identity. Their language, religious beliefs, diet and customs all have changed to a large extend and they face a cultural identity crisis. This tribe is losing all their values and stand nowhere among the American society. Recognition from government - They don’t get the right recognition from the federal government and only some communities are considered as tribes by the government. The American government has not done anything credible to protect this tribe. Many children were removed from their homes for the purpose of education and this dismantled their family structure. Even the land allotment law was not of much help to the tribes. The children were forced to abandon their language and government did nothing to protect them. The tribe still does not have much recognition like other citizens. Anishinabe tribe still faces tension with the state government and country governments. They do not get full recognition from federal government. Anishinabe tribe is considered as a tribe by some state government however some state does not give much recognition to them. The band government formed by the tribes does not get much recognition

Halting the wheels of hope Essay Example for Free

Halting the wheels of hope Essay The concept of governmental tyranny is often difficult to grasp to those living in more democratic nations, and media output and literature become key in growing to understand it’s implications. Serving to heighten this political perspective is â€Å"The Wheels of Freedom: Bicycles in China† by Fred Strebeigh, which describes China’s bicycle ban in 1989 and subsequent protests in Tiananmen Square, Beijing. The bicycle provided significant growth and freedom within Chinese culture, and Strebeigh endeavors to communicate this to readers. Illustrating this, he defends the will of the people to preserve their right to ride them in the face of government opposition, and the tragedy imposed by political oppression. Upon the bicycle’s introduction to the people of China in the early 20th century, many looked to it through eyes of bewilderment. A fascinating and not yet popularized machine, it was most commonly ridden by members of affluent societies. As it’s newness wore off, however, it slowly became available those of the more humble classes, and in place of the word â€Å"bicycle†, the term â€Å"foreign horse† found it’s use in the minds and mouths of the masses. Strebeigh includes that the term â€Å"foreign† communicated the people’s feelings of admiration for the bicycle while alluding to the fact that it was modern. The peasantry of China found themselves with the deepest sense of admiration for the â€Å"foreign horse†. To them, the thought of owning one brought to mind the ease it could bring to their everyday lives, as they often carried burdensome loads on their backs. Yet, the low supply and thus high cost of the bicycle made it’s acquisition impractical for them. In response to the desire, the government later began regulating higher production rates of the bicycle to readily supply them to the impoverished and raise morale. However, the term â€Å"foreign horse† was banned in light of it’s glorification of another nation’s ingenuity, highlighting the extremes of the Chinese government to exercise their sovereign of the people. In it’s place, the name â€Å"self-running cart†. This served to express the government sentiment that the people could have what they wanted, but only at it’somplete jurisdiction. The people tolerated the name change of their beloved bicycles, as the trade-off of name for it’s widespread distribution was easy enough, and many still used it’s original moniker in private. Following it’s popularization, the lives of many saw an enrichment in quality. The dignity of the people improved, as it granted them new freedoms and eased the stress of everyday tasks, al lowing for flourishing business and connectedness within communities. Perhaps stated best, Strebeigh wrote of it’s wide use, â€Å"Everywhere, cycles kept life rolling† (Strebeigh). In addition to heightening the commerce of societies, it introduced the occupation of bicycle repair, which Stebeigh revered as perhaps the â€Å"freest† job in China. In it’s praise, he wrote, â€Å"A hard worker needed only a street corner and a few tools. Before his eyes bikes would inevitably break down and, if he was skilled, clients would multiply. Bicycle repair seemed to offer an extension of what the bike itself offered and what so many Chinese sought: modest dignity, new choices, ample freedom. † (Strebeigh). Bike repair was a choice outside of the typical, and entirely pursued as an individual pleased. Sadly, it was the bicycles issuance of dignity, choices, and freedom that that ultimately inflicted threat upon the Chinese government. They understood that with bike ownership, the people were growing to a height of advantage. It was their supposition that, if the people continued in such a fashion, government control perhaps had the potential to become menial. To ensure that their ultimate authority was not being overlooked, a ban was placed on bicycles within China. News of this did not come amicably to the people, and their response was protest. It was Tianenmen Square in Bejing which saw the organization of a large-scale demonstration which rallied for government reform. It lasted weeks, and ended upon the mobilization of troops to the area. Their invasion was destructive and resulted in the loss of many lives as troops initiated the use of tanks and weaponry to control the people. In media coverage, it was not the bloodied bodies of victims that were aired on television screens in Chinese homes, but rather the depiction of bicycles which had been crushed by the military. Of it, Strebeigh writes, â€Å"They wanted to show crushed dignity, crushed humanity, crushed freedomso much that the bicycle means in China. † (Strebeigh). This image was a wise devise of the government. They knew what the bicycle represented to the people, and knew that to show it destroyed would communicate their dominance and triumph. The concept of tyrannical rule and its implied bleakness are often incomprehensible, or altogether unrecognized by the people of more democratic countries given their many freedoms. With the words of Fred Strebeigh, however, perspective expands. The honor of an object as seemingly simple as a bicycle becomes worthy of defense, even dying for, and the tragedy of oppressive rule becomes very real. Works Cited

Real Boys Essay -- English Literature Essays

Real Boys While Reading the book Real Boys by Dr. William Pollack, I realized that our society is holding boys to contradictory standards aiding the problems that many of them face while in adolescence. This book introduces the reader to numerous boys who share their feelings of shame and despair in trying to live up to the "Boy Code". Pollack feels the pain that comes from boys prematurely separating from their mothers puts them on the cycle to hardening themselves emotionally. The one acceptable emotion becomes anger. Throughout the book Pollack encourages parents to take time with their sons in helping them express their feelings while showing them empathy and love. Pollack discusses the ways parents can help their boys escape from the gender straightjacket that is imposed upon them. Pollack exposes myths that negatively portray boys as macho creatures shaped by testosterone with no social skills. He instead presents examples of boys who are emphatic as a result of nurturing parents and educates the reader to be aware that boys express their love through action and work. Pollack includes chapters regarding the different but equally important role of mothers and fathers in bringing up their sons. He also writes about the effect of healthy relationships with peers and the devastation that some boys feel when they discover they are homosexual. Pollack takes on the schools in failing boys in a number of ways but specifically for failing to understand the Boy Code. Boys continue to lose self-esteem as the mask of masculinity tightens and they conform to what society expects from them, interfering with their ability to learn effectively. Dr. Pollack not only gives us the problems that face the adolescent boy he also gives us suggestions to remedy and rectify the situation. This is nice instead of simply offering negative statements he actually offers the reader a solution. Another beneficial aspect of Dr. Pollack’s writing is the fact that he uses so many references to his research and the research of other notable psychologists instead of over emphasizing the personal instances in his own life. When he wants to emphasize a point with a real life person, he uses a third party. When speaking of these contradictory codes that a young boys is taught to live by, Dr. Pollack says: "Boys have had to learn to walk a fine line. Have intimacy without sentimen... ...ollack talks on breaking down gender stereotypes; he seems to perpetuate them by seeming to insist that the mom be the central part of upbringing. Extensive sections on single moms but the only discussion of single dad households is two sentences which state that research showing relatively positive outcomes (i.e. relative to mom getting sole custody, not relative to intact families) is controversial. Pollack notes that Dads are more likely to suffer from depression after a divorce but does not draw the logical reason. Dads lose far more than moms in a divorce. Yes moms economic status goes down more, but she tends to keep what is really important... the kids. Even today the courts are horribly biased against men in divorce cases. A mom must be totally unfit to not get at least joint custody, dad has to fight for minimal visitation rights. These are however minor quibbles with the book, the central principle of the book: Today’s boys are in big trouble, and much of that tr ouble stems from never being allowed to show any negative emotion other than anger, is a very important one. Boys are not toxic they need our love and support, even if they put on a tough self-sufficient disguise.

Children in Crisis Essay

When one thinks of people in crisis, children are usually the furthest thing from their mind. The fact is that children endure crisis just the same as adults. The difference is that their coping skills are limited due to the fact that their brains are not fully developed and their cognitive abilities are limited. Children endure crisis in all kinds of ways. Some have been traumatized due to a natural disaster, others by divorce, death, foster care, asthma or because of a mental disorder. This paper will discuss some of the different types of crisis that children endure and the effect that the crisis has had on their lives. Children in Crisis Everyone has encountered a crisis at some point in their life. What might be a crisis for one individual is not a crisis for another. A crisis can be defined as â€Å"a perception or experiencing of an event or situation as an intolerable difficulty that exceeds the person’s current resources and coping mechanisms† (James, 2008, p. 3). If an individual does not get help with overcoming their crisis then the crisis could have a severe impact on their behavior as well as their cognitive functioning. James, 2008) A crisis becomes a crisis in ones life because they do not have the knowledge of how to handle or deal with their current situation. They are often times paralyzed emotionally and mentally which leaves them feeling out of control of their lives. When one thinks of people in crisis, children do not usually cross their mind. The truth of the matter is that children endure crisis just like adults do. Most adult who experience a crisis are unable to help their self and they definitely are not going to be able to help their children. Children do not have the same coping skills as adults and often times end up needing psychiatric treatment as a result of crisis in their lives. Children can endure crisis in many ways. Some, but not all, of these ways are through experiencing natural/man-made disasters, others by divorce of their parents, death of a friend or relative, being placed in foster care, having a childhood illness such as asthma or because of a mental disorder. These children, like adults, need help to therapeutically process through the crisis in their lives. Crisis most always means that one has lost someone or something. Children need help accepting their losses and expressing their painful emotions in appropriate ways. Children are resilient, but they also experience feelings of fear, anxiety, guilt, anger and sorrow. It is important to help children understand that enduring crisis is an opportunity to see God at work in their life. Types of Crisis That Children Endure A natural or man-made disaster is something that many children across the United States have had to deal with. Many of these disasters have been compounded by having a crisis within a crisis. An example of this would be the traumatic events of September 11, 2001. This was a crisis that no one was prepared for and unfortunately because of those who died in this horrible attack, many children were left without one or both of their parents. These type of events leave children â€Å"terrified, not only by the event, but by their own thoughts and feelings† (Gaffney, 2006, p. 1005) regarding the event. Children who experience this type of crisis often seem as though they have lost touch with reality. They might not be able to clearly communicate about the crisis and many times are mistakenly labeled as â€Å"poor historians† (Gaffney, 2006) because they are not able to sequence the event correctly. This is because the child’s â€Å"brain’s ability to process, retain, and recall information has been compromised by the trauma† (Gaffney, 2006, p. 1006). They have trouble identifying their feelings and placing appropriate emotions with those feelings. This leaves the child with unresolved issues and a picture in their mind that they are unable to verbally describe. It is expected that children who endure this type of trauma will â€Å"exhibit transient to long-term behavior changes† (Gaffney, 2006, p. 1010). This behavioral change can be anything from biting their lip to withdrawing socially. In order for the child to begin the healing process after a natural or man-made disaster, one must help them to understand that they will never forget the people or things they have lost, but their pain will become easier as time goes by. Divorce is another crisis that many children endure that leaves them in a shattered world of hopes and dreams. Divorce for a child means that life as they once knew it will never be the same. Children who have parents that divorce often times have to begin living new lives. They are required to conform to two different standards of living which represent two different sets of values. These children are experiencing conflict at all times due to having disgruntled parents. These parents lose their ability to support their children because they are focused on their own feelings of not being supported by their spouse. Divorce can create loyalty issues for the children and cause them to feel as though they have to take sides and dislike the other parent. A divorce can interrupt a child’s emotional and educational development. A child’s age will cause them to respond to divorce differently. Preschool children â€Å"have an incomplete and confused understanding of what has caused such a radical change in the family routine† (Henning, 1977, p. 55). The child’s ability to cope is very limited and the most common emotion that they experience is fear. They are unable to verbalize their feelings, but replay pictures in their mind of the verbal and sometimes physically abuse they have witnessed. School aged children are magical thinkers and envision the parents getting back together by working out their problems. These children are easily manipulated by gifts or tokens and like the idea of being able to â€Å"get whatever they want† (Henning, 1977) from the other parent. These children often worry about who will care for them if the other parent dies or becomes ill. Adolescent children are more prone to experience anger and depression during times of divorce. These children are more apt to participate in deviant behavior as a way of expressing their emotions concerning the divorce. Their academics suffer and students who were making good grades begin to fail. The biggest issue for â€Å"children during the divorce process is that the adults involved in marital strife are not looking for ways in which to help their children adjust to the transition, but are searching for ways to implement their own personal life readjustment† (Henning, 1997, p. 56). Experiencing divorce can actually be a form of death in a child’s life. The death of a parent, friend or loved one is one of the most disturbing experiences that a child will ever face. Death, especially of a parent, leaves the child feeling scared and alone. They do not believe that others truly understand what they are feeling. They desire for the one they have lost to return to them. This often leaves the child with painful memories of their loved one. Children will â€Å"cry easily, lose interest in eating, or experience physical discomfort† (Gaffney, 2006, p. 1008). In order for these children to heal, they must first deal with the symptoms they are experiencing as a result of their traumatic event. Then they must have help walking through the grieving process. Gaffney, 2006) This same grieving process is experienced by children who have been placed into foster care. Although their parents have not physically died, their life as they once knew it has. It is reported that approximately â€Å"40,000 children in the United States live in out-of-home residential care facilities† (Ulrich, 2005, p. 13). This does not include the number of children that are entering therapeutic foster homes on a daily basis. These children are removed from their homes, families and environments to be placed in unfamiliar surroundings. Then these children are expected to flourish. These children enter into a state of crisis because they feel that both them â€Å"and the situation are about to be out of control† (Smiar, 1992, p. 149). They are told that they now have a new family, will start a new school, and have to make new friends. They are told by their caseworker that they can trust them. Then the child finds out that the caseworker has moved on and a new caseworker has been assigned to their case. This was the individual who was supposed to be â€Å"responsible for their safety, stability, well-being and permanence† (Strolin-Goltzman, 2010, p. 7), yet they are now gone. This creates problems related to emotional and physical stability for these children. They have lost trust in the adults in their life due to a series of unhealthy relationships and take on a non-caring attitude. This non-caring attitude will often cost the child their current placement mainly if the family is not prepared to handle aggressive, defiant behavior. These particu lar children spend the remainder of their time in foster care moving from placement to placement. Their life is forever changed at the hand of â€Å"caring adults† who want them to experience a better life. It is the constant changing in one’s life along with unresolved emotional issues that cause these children to end up in a psychiatric facility and then diagnosed with a mental disorder. According to research ,â€Å"one in 5 children has a diagnosable mental health or addictive disorders, and 2 in 10 has a serious emotional disturbance that significantly impairs functioning at school, at home and in the community† (Mellin, 2009, p. 501). It is suggested that the â€Å"prevalence of serious emotional disorders is higher among children who are in state custody than in the general population† (Lyons, 1997, p. 312). This is due to the risk factors involved prior to the children being placed into foster care and because of the separation from their biological families which have now created emotional and behavioral problems in the child’s life. The child’s behavior can become out of control and beyond what a therapeutic home can provide for. It is at this time that they are referred to the psychiatric hospital. These hospitals become a place of transition into a residential treatment facility. Once again, these children have endured yet another move. They have now been given a diagnosis that leaves them with the assumption that they are crazy and beyond repair. Many children end up with a dual diagnosis because of genetic disorders or childhood illness. One childhood illness that creates crisis in a child’s life is asthma and the â€Å"current prevalence of doctor-diagnosed childhood in the United States is estimated as 7%† (Nicholas, 2005, p. 245). Asthma causes recurring periods of wheezing (a whistling sound when you breathe), chest tightness, shortness of breath, and coughing. The coughing usually occurs at night or early in the morning. Children with asthma often have to reduce or limit their play due to their asthmatic symptoms. During an aggressive asthma attack, these children are not able to breath appropriately and are faced with a fear of death. It is for this reason that they must have an asthma action plan in place, take their prescribed medications, and live in a preventative environment. It is important for the families of children with asthma to create a safe and healthy environment for them to live in. This can be done by eliminating tobacco smoke, animal dander, using dust covers for bed mattresses, and making sure that the home is free from pest and rodents. These steps are prevention measures only, they do not eliminate the crisis the child can experience due to not being able to breathe appropriately. Children with asthma would benefit from therapeutic services while learning to cope with their childhood disease.

Company Auditing

Group Assignment – HBC614B Company Auditing PART 1 THE INTERNATIONAL AUDITING STANDARDS BOARD AND ITS IMPORTANCE TO THE DEVELOPMENT OF AUDITING STANDARDS IN AUSTRALIA AND NEW ZEALAND The International Auditing and Assurance Standards Board (IAASB) is an independent standard setting body within the International Federation of Accountants (IFAC). Established in 1978, originally known as International Auditing Practices Committee (IAPC), it changed its name to IAASB in early 2001 and was then reformed by IFAC in 2003.IAASB puts public interest first and aims to improve the quality and uniformity of practice throughout the world and to strengthen public confidence in the global auditing and assurance profession by facilitating the convergence of international and national standards. IAASB is committed to achieve its objectives through the following works: †¢ Developing Standards – establish high quality auditing, review, other assurance, quality control and related ser vices standards, such as International Standards on Auditing (ISAs). Global Acceptance & Convergence – promote the acceptance and adoption of IAASB pronouncements throughout the world and support a strong and solid international accountancy profession by coordinating with IFAC member bodies, regional organisations and national standard setters. †¢ Communication – encourage debate and present papers on a variety of audit and assurance issues and increase the public image and awareness of the activities of the IAASB. To date, the IAASB has earned increasing recognition for the quality of its standards and the credibility of its standard setting process.This has contributed to the increasing use of its standards worldwide. Over 100 countries are now using or are in the process of adopting ISAs into their national auditing standards. For investors in international capital markets, the quality of audit reports and audit opinions on financial reports are crucial when th ey make decisions about capital allocation. Audits, working within internationally accepted auditing standards, increase the credibility and reliability of the financial information provided in the financial reports.As Australian capital markets are increasingly linked with overseas markets, it is important to have a globally standardised financial reporting framework that is supported by globally accepted auditing standards. The Australian Auditing and Assurance Standards Board (AUASB) made the compliance with IAASB standards easier via a long-standing policy of convergence and harmonisation with ISAs. The AUASB uses ISAs as a base to develop Australian Standards on Auditing (ASA).For any revision and enhancement of ISAs initiated by the IAASB, the AUASB will make appropriate consequential amendments to ASA. The AUASB and IAASB generally issue an exposure draft of a proposed auditing and assurance standard concurrently for consideration by interested parties. In New Zealand, New Ze aland Auditing Standards (AS) and Audit Guidance Statements (AGS) are also based on ISAs and International Auditing Practice Statements (IAPS). The New Zealand auditing authority adopts the IFAC documents and amends them only as necessary to achieve its – 1 of 11 –Group Assignment – HBC614B Company Auditing objectives. Amendments to the IFAC documents may be made to reflect specific New Zealand legislative requirements or to reflect specific audit practising arrangements within New Zealand. As we can see, for years since IAPC or IAASB was established, it has played a very important role in enhancing and standardizing the quality of auditing and assurance services around the world. ============================= – 2 of 11 – Group Assignment – HBC614B Company Auditing PART 2 CO-REGULATION OF AUDITING PRACTICE IN AUSTRALIAIn most developed countries, including Australia, the auditing regulatory framework is provided, at least to some extent, by government through legislation and government agencies. In the past, however, the auditing profession in Australia was largely self-regulated through the rules and requirements self-imposed by the principal players in the field, i. e. auditing firms and auditing professional bodies. As a result of the Corporate Law Economic Reform Program (CLERP) 9, the Auditing and Assurance Standards Board (AUASB) became a statutory (government) body.Since April 28th 2006, the Australian Auditing Standards (ASAs), which have been released by AUASB for purposes of section 336 of Corporation Act 2001, have Force of Law. The Financial Reporting Council (FRC), a statutory body under the Australian Securities and Investments Commission Act 2001 (ASIC Act), is responsible for providing broad oversight of the process for setting accounting and auditing standards as well as monitoring the effectiveness of auditor independence requirements in Australia.Yet the control and enforcement mechanism of these sta ndards is also supported by the auditing profession represented by two primary professional accounting organisations: CPA Australia and the Institute of Chartered Accountants in Australia (ICAA). Although the membership in these two organizations is voluntarily, it is still a necessary condition to get registration as a Company Auditor or a Liquidator. Some methods of control of quality of the auditing services imposed by these professional organisations include peer reviews, continued professional development and periodical rotation of the auditors.There are also disciplinary procedures in place to encourage improved ethical behaviour and quality of service provided. This particular model of co-existence of government regulation and industry self-regulation in Australia is called ‘co-regulation’ of auditing practice. Co-regulation provides ‘interactions that produce pressures for the refinement of regulatory structures in terms of openness, consultation, independ ence and speed of response to urgent accounting problems’ [Malcolm C. Miller]. ============================= – 3 of 11 – Group Assignment – HBC614B Company Auditing PART 3 QUESTION 6. 3 – ASA 315 UNDERSTANDING THE ENTITY AND ITS ENVIRONMENT AND ASSESSING THE RISKS OF MATERIAL MISSTATEMENT – HOMECHEF PTY LTD. A first and very important step of the audit process involves the auditor gaining an early understanding and knowledge of the client’s business. In fact, ASA 315 requires that this step is carried out during the audit planning stage. The auditor must obtain or update their understanding of the client’s operations and circumstances, including its organisational structure, management policies, the company’ position in its industry, the economy and its legal obligations.ASA 315 provides extensive guidance on matters related to obtaining an understanding of the entity and its environment, which may be classified into thr ee main categories: (1) Internal control / organisational structure (2) Operational and legal structure (3) Industry and economic conditions An understanding of these three elements helps the auditor assess the client’s business risk and identify the events, transactions and practices that may have a significant effect on its financial report. This report presents a recent review of the operations and circumstances of one of our clients, HomeChef Pty Ltd. in accordance with the requirements of ASA 315. The main objective was to identify the events and developments at HomeChef which may have a significant bearing on the company’s business risk and consequently affect our audit. This understanding will help us plan and perform the audit more efficiently and effectively and will ultimately improve the services we provide to our client. HomeChef Pty Ltd has been the market leader in the boutique food and beverage industry for the last two years.The company manufactures, su pplies and retails quality ingredients for use in the home kitchen and small restaurant market. During the review our audit team identified a number of major events/transactions that may have a significant impact on the business and affect our audit process. Below is a brief discussion on each of these events/transactions: 1) New products and services: Recently, HomeChef introduced ‘pre-packaged’ meals suitable to be served at a dinner party. Preparation of the ‘ready to serve meals’ would require extra steps to produce the final product.This would involve more processing facilities, more staff and more advertising. One potential related business risk might be the increased product liability. There may be extra compliance requirements from the Food Safety Regulators. There could also be risk that the demand has not been accurately estimated. The company’s capital and current expenditure may increase significantly because of the launch of the new prod uct. This situation tends to increase our audit risk. The auditor, therefore, should carefully consider how this changing operating characteristic may affect his/her auditing process.For example, he/she may need to review some Food Safety Regulation requirements to assess that correct amounts of expenditure is attributed to this particular type of compliance; or refer to some industry literature to get a better understanding of the niche market for this type of product. Reviewing – 4 of 11 – Group Assignment – HBC614B Company Auditing sales figures and sale forecasts may also help to assess to what degree the company’s business risk may be affected by this new development. 2) New lines of business: HomeChef has recently opened a number of small cafe where customers can sample the s company’s product range.By doing so, the company is venturing into unfamiliar territory. In addition, the notes of HomeChef’s draft financial report reveal that t he company has entered into agreements for building and developing a new entertainment complex. These events indicate not only changes in the company’s operational structure, but also those relating to its environment. New opportunities bring new risks. As this is HomeChef’s first venture into a new business area, lack of expertise and experience could be a real concern. The hospitality industry operates quite differently from the food manufacturing.There could be many more competitive forces and regulations in place. This move could change the organisational/operational structure of the company drastically. For example, new divisions may need to be established and the company hierarchy changed. Apart from the potential risks of increased product liability and inaccurate demand estimates, similar to the case of all new products, this could introduce new risks associated with the company’s internal control. Also, the company’s potential business risk would increase its inherent risk. In general, this event is likely to increase our audit risk.It is very important that the auditor familiarises him/herself with the company’s new operational structure, the industry conditions and regulatory environment related to this new line of business. Reviewing the hospitality industry publications and significant industry legislation may assist with basic understanding of how the company business risk is affected by this move. Aggressive marketing and acquisition strategy – Rapid growth: Over the last two years HomeChef has acquired a number of smaller competitors and become the market leader in its industry.This is an indication of the company’s aggressive approach to expansion and growth. In such situations, it is often noticed that a company’s infrastructure is likely to lag behind in the process. In a hurry to expand, the organisational structure of the company may be changing too fast. There could be staff members with insufficient experience, the IT system may not cope well under the new conditions as new procedures and processes are added in. This significant and rapid expansion of operations could create strain and increase the risk of a breakdown in controls.The auditor needs to discuss with the senior management and gather evidence from the company’s documents to assess this risk. He/she may need further understanding of the current cycle in the industry, to assess how this ‘acquisition spree’ could affect HomeChef’s business risk, and consequently the audit risk. Reviewing government statistics, trend forecasts, trade journals and financial newspapers may help improve the auditor’s understanding of the industry in general and the business in particular.Changes in key personnel: The departure of a key executive (HomeChef’s finance director), probably with a significant loss of corporate history and experience, may also have an impact on the busine ss. The new finance manager has been with the company for less than a month and may take some time to gain the knowledge and understanding of the business. He may have a different focus or 3) 4) – 5 of 11 – Group Assignment – HBC614B Company Auditing understanding of the company’s internal control.The auditor should take this factor into account when assessing the risks of misstatements associated with the company’s financial report which, possibly, has been prepared under the instructions of the new finance director. 5) Newly-established internal audit group: HomeChef started using the service of an internal audit group for the first time this year. Generally, the existence and operation of an internal audit group indicate the commitment and serious consideration given to maintaining high standards of internal control by the management. This would normally reduce the control risk in a business and subsequently reduce the audit risk.In addition, th e external auditor could, to some extent, use the work of an internal auditor, after having gained knowledge of and satisfied with the scope of internal auditing and the audit team’s technical competence and professional care. However, in this case, as HomeChef’s audit team is new, careful considerations are required if the auditor is to rely on the internal team’s audit work. Installation of a significant new IT system related to financial reporting: HomeChef switched to a new computer system early this year. The system was installed by a professional computer company and the old and new systems were run parallel for 3 months.Some new functions/modules have been introduced in the new system, including the ability to process stocktake results, account payable invoices and payments at the store level. This event highlighted a major change in one of the company’s internal control components. It seems that the new system is rather reliable as a systematic te sting plan and an integrity checking process were carried out by the professional computer company and there have been no major problems with the system so far. The use of this new system could potentially decrease the company’s control risk. The audit strategy could focus on test of control.A proper and systematic testing plan on the new system is recommended, especially on the new modules for stocktake and accounts payable process. Significant amount of non-routine/non-systematic transactions: HomeChef’s draft Income Statement includes an ‘extraordinary item’ of $231 million without any notes or explanations attached to it. The existence of this ‘extraordinary’ loss would certainly have a significant impact on the business and would increase the audit risk considerably. This particular transaction requires a significant amount of attention by the auditor.Enquiries should be made to understand the nature and extent of all relevant details of this transaction. This would help the auditor assess if the transaction is legal, not dismissing the possibility of fraud, or errors, such as transactions recorded without substance, intentional misapplication of accounting policies, mathematical mistakes, oversight or misinterpretation of facts. The auditor should also examine if the valuation and allocation of the amounts have been done correctly. Company records and legal documents will need to be reviewed. An extensive substantive audit approach would be suitable for this particular area of the audit.Debt structure – Covenant agreement: Note (e) to the draft Financial Report reveals that a covenant agreement exists between HomeChef and its bank. The bank loans are secured against the company’s remaining property, plant and equipment. This agreement specifies that the company should maintain a 6) 7) 8) – 6 of 11 – Group Assignment – HBC614B Company Auditing positive net tangible asset ratio and a positive current ratio. Given the large amount at stake, there is a great incentive for the company to falsify, alter and manipulate figures to achieve these positive ratios at any cost.This situation would increase HomeChef’s business risk significantly and consequently increase our audit risk. The audit plan could focus on substantive testing of the accounts related to the current ratio and net asset ratio. The auditor must exercise reasonable care and skill and maintain an attitude of professional scepticism throughout the audit. Based on HomeChef’s financial ratios being adverse and the subsequent difficulty in complying with the terms of loan agreements, the auditor may need to raise a going concern issue.It would be necessary for the auditor to discuss this problem with HomeChef’s management so that appropriate measures could be taken by the company to overcome this situation. As a result of reviewing HomeChef’s operations and environment, includi ng its financial and marketing position, using the precepts of ASA 315, our audit team has been able to update our knowledge of the company’s situation and assess our audit risk accordingly. This understanding and assessment will direct the development of our strategy and plan for the audit of HomeChef. ============================ – 7 of 11 – Group Assignment – HBC614B Company Auditing PART 4 QUESTION 6. 22 – IMPACT OF BUSINESS RISK ASSESSMENT ON AUDIT STRATEGY This report presents a short case study of Weave Limited. The main purpose of the case study is to look at how Business Risk impacts on Audit Risk, and consequently, on Audit Strategy and Plan. Weave Limited is a closely held private company, manufacturing high-quality woollen cloth. It has been in operation for almost 60 years and the CEO of the company is also its major shareholder.Currently, the company is under a great financial stress due to increased competition and falling sales volu me. Three years ago the company was sued for dumping chemical pollutants into the local river. As a result, a settlement was signed with the Environmental Protection Agency providing that Weave construct a water treatment facility within five years. Our Audit Firm has been auditing Weave for the last ten years, and the current year interim audit revealed that there has been virtually no activity in the Water Treatment Facility Construction account in the current financial year.To prepare for this year audit we need to take the following steps: (1) review the company’s business risk i. e. the risk that Weave’s business objectives will not be attained due to the above-mentioned pressures and, ultimately, the risk associated with its profitability and survival. (2) assess the implications of the company’s business risk on our audit risk (3) develop our audit strategy and audit program in response to the assessed risks. In order to assess Weave’s business ris k, we felt that a PEST analysis would be the most appropriate approach.It involves identifying the political/legal, economic, social and technological influences on an entity. †¢ Environmental Protection Laws may have a heavy toll on the business. Compliance with these Laws (such as building a water treatment facility) may be very expensive, but non-compliance may actually have a suicidal effect on the company. †¢ Economic risk should also be taken into account. Increased competition and limited market for Weave’s high quality and possibly expensive products could pose a serious threat to the company’s profitability and ultimately its very survival. Social risk component is also present in this case. The surrounding area is poor and unemployment rate is high. The company’s management may feel a social pressure to provide employment at any cost. The obligation to build a water treatment facility could be very expensive and resource-consuming. It is not an easy task to estimate or to make provisions for the resources required to meet this obligation. It is even harder to estimate the costs of not meeting this obligation. This adds unusual pressure on the management.Potential incentives could arise for management to understate the company’s profit/cash flow to use as an excuse in an attempt to avoid fulfilling this particular liability. This situation is likely to increase Weave’s inherent risks. – 8 of 11 – Group Assignment – HBC614B Company Auditing In assessing the company’s control risks, certain observations and issues have come to our attention which suggest an unsatisfactory internal control system: †¢ The company’s CEO is also its major shareholder who seems to be a strong character that has the overriding authority and decision making power. The CEO does not seem to take the compliance with the conditions imposed by the Government’s Environmental Protection Agency seriously. He decided to stop work on the water treatment facility as he thought that the State would not fine or close the company down for non-compliance. †¢ The company does not seem to have any risk assessment policies or procedures for dealing with business risk. Based on the above findings, the audit team agreed that Weave’s business/inherent risks and control risks could be assessed as high.This conclusion has had an impact on our audit strategy and audit plan. As we believe that the control risks are high, an audit strategy of a predominantly substantive approach has been adopted. We do not plan to obtain a thorough understanding of the company’s internal control or to carry out tests of control. Instead, we plan extensive substantive audit procedures based on a low to medium acceptable level of detection risk (depending whether the assertions under examination are at risk).In response to the high level of inherent risks, we decided to assign more experie nced audit personnel and to conduct the audit with a heightened degree of professional scepticism. As mentioned earlier, an accurate assessment of the extent of liability related to the breach of the environmental laws is not easy to achieve. As the company’s management does not seem to recognise the seriousness of this risk or to respond to it properly, we decided to engage environmental and technical experts to assist by providing us with legal/environmental opinion and estimates.The engagement of an environmental consultant will be scheduled to happen before the year end audit. Weave’s increased inherent risk and control risk increase our audit risk. Some assertions in the company’s financial reports have been identified as the key audit assertions as they tend to be more at risk. These assertions will be examined closely (please refer to the matrix below) and more efforts will be focused on obtaining sufficient and appropriate evidence to test these assertio ns.Financial Acct Liability Acct (provision for water treatment facility) Contingent Liabilties Valuation of the provision Sales Acct (Income Statement Assertions) Completeness all sales recorded Accuracy of recorded sales amounts Correct accounting period cut-off Inherent Risk Control Risk Debtor's confirmation Assertions at risk (Balance Sheet Assertions) Completeness of all liabilities Inherent Risk Engagement of environmental expert/consultant Quotation / project estimations are recorded properly with appropriate amounts Audit Risk Procedures/Evidence 9 of 11 – Group Assignment – HBC614B Company Auditing To test if the liability account for the water treatment facility contains any material misstatement we will focus on whether the account has included all liabilities as per the environmental specialist’s advice and the amounts are properly estimated and recorded (completeness and valuation). We could do this by seeking confirmation from the environmental sp ecialist and checking estimates/quotations for the project.To support the company’s claim of ‘low sales volume’ and ‘low level of cash flow’, we will test if all sales transactions pertaining to the company have been included in the income statement (completeness) and all sales occurred during the current accounting period have been properly recorded with the correct amounts (accuracy and cut-off). Collecting debtors’ confirmations could be the approach to carry out this test. As our team has audited the company for the last ten years, it is assumed that there must be a certain degree of familiarity and complacency.However, due to the new developments in the company’ situation, more specifically, higher level of business risk, this year’s audit strategy and plan have been revised accordingly. Apart from additional audit procedures and probably a larger sample size, our team will need to maintain a higher level of professional sce pticism to make sure that the company’s accounts contain no material misstatements. It should be noted that had this audit been undertaken in the seventh year after the signing of the settlement with the Government’s Environmental Protection Agency, the situation would be different.As the condition of the settlement to build a water treatment facility would have been breached by now, there is an imminent threat of the company being closed down by the government. A ‘going concern’ assessment at the planning stage (as required by ASA 570) would provide the following going concern problem indications: (1) increased competition and falling sales, (2) noncompliance with statutory requirements, and (3) legal proceedings against the entity. In cases where going concern is related to cash flow or solvency problems, some mitigating factors could be considered (such as sale of assets or additional contributions by owners).However, in this case, it could be judged th at a going concern basis is not appropriate as the business is now subject to closure by government regulation enforcement. We, as the auditors, would need to discuss ways to deal with the problem with the company’s management. The possible outcomes could range from renegotiating the settlement agreement to making the decision to liquidate. In the latter case, the auditors would have to assess the impact that a forced sale of assets would have on the book values and the classifications of assets.The auditors would also need to assess the amount and classification of liabilities, including any provision for staff termination payments and other closing-down expenses. In any way, if going concern is an issue it should be adequately reflected (disclosed) in the Financial Reports. The Auditor’s Report should also include an ‘emphasis of matter’ [ASA701. 09 & ASA570], clearly stating that there is a significant uncertainty regarding a going concern problem. ==== ========================= – 10 of 11 – Group Assignment – HBC614B Company Auditing REFERENCES: 1. 2.Australian Auditing and Assurance Handbook, 2007 Edition, CPA Australia Australian Government’s Financial Reporting Council 2005, Australian Government’s Financial Reporting Council, viewed 20 May 2008, http://www. frc. gov. au/about 3. Brief History 2008, International Auditing and Assurance Standards Board, IAS Plus, Deloitte, viewed 18 May 2008, http://www. iasplus. com/ifac/iaasb. htm 4. Chris Pearce, Parliamentary Secretary to the Treasury, 22 November 2004, â€Å"The future of governance regulation in Australia, Address to the 21st National Conference of Chartered Secretaries Australia†, viewed 19 May 2008, http://www. reasurer. gov. au/DisplayDocs. aspx? doc=speeches/2004/001. htm=005=cjp=20 04=1 5. Gay & Simnett, 2007, ‘Chapter 6 Planning, Knowledge of the Business and Evaluating Business Risk’, Auditing and Assurance Serv ices in Australia, revised edn 3, McGraw-Hill Australia Pty Ltd. 6. International Auditing and Assurance Standards Board 2008, IFAC, viewed 18 May 2008, http://www. ifac. org/IAASB/ 7. James M. Sylph, January 14, 2005, â€Å"Global Convergence – Near or Far? †, American Accounting Association Auditing Section 2005 Mid Year Conference