Bigger Than Enron

In: Business and Management

Submitted By irmab
Words 736
Pages 3
Lobbing of commercial and political interests in the establishing of the standards is a fact, which leads to believe that there might be large groups of the financial information users, who are interested in the particular way of reporting. If it is beneficial to them and to the market without compromising any ethical issues related to the financial reporting, if the market gains from such interests, than the standards should be formed under such influence. The question is who is going to decide if there are benefits. I guess, this is the area where the real politic starts. At this level of decision making, I think there should be people free of any political or economic pressure. However, more often commercial and political interests do not represent the majority of the market and are directed at misrepresenting the real situation to receive immediate gain or preferences. With the focus on the political aspects of the decision making regarding the standards, the stress on allocating capitals to healthy and innovative entities shifts. As the capital goes to the “wrong” companies, and the practice becomes standard, the economy weakens. That is why it is not always good to allow political interests influence standard setting.
The general understanding is that by granting the employees the option to buy the company’s stock, the company makes the employees be more interested in generating more profit. If the employees receive substantial gains from the stock they have, they start look forward to it and work on maintaining the value of the stork and raising it. The employees can sell a set number of company shares when the price of the stock goes above a fixed level within a fixed period of time. The higher the stock price, the greater a profit an employee gets. In some firms the executives own a large amount of shares. Being interested in the highest profit possible,…...

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