Pediatric Recommended Core Measures Health And Social Care Essay

After run intoing Stage 1 for the two old ages, Fletcher Allen Partners will necessitate to run into meaningful usage Phase 2 standards get downing in 2014 ( Figure 1 ) . With this following phase, EHRs will farther salvage Fletcher Allen Partners money, save clip for physicians and infirmaries, and salvage lives.The Stage 2 standards includes new aims to better patient attention through better clinical determination support, attention coordination and patient battle ( cms.com ) . The phase 2 ends would spread out the Phase 1 standards and concentrate on the meaningful usage of electronic wellness records ( EHRs ) to back up the purposes and precedences of the National Quality Strategy ( NQS ) . The Phase 2 standards encourages the usage of wellness IT for uninterrupted attention and information quality betterment. The proposed Phase 2 meaningful usage demands include strict outlooks for wellness information exchange and include: more demanding demands for eprescribing ; integrating structured laboratory consequences ; and the outlook that suppliers will electronically convey patient attention sum-ups with each other and with the patient to back up passages in attention. Phase 2 focal points on existent usage instances of electronic information exchange and requires that a supplier direct a sum-up of attention record for more than 50 % of passages of attention and referrals. The regulation besides requires that a supplier electronically transmit a sum-up of attention for more than 10 % of passages of attention and referrals. Increasingly robust outlooks for wellness information exchange in Stage 2 and Stage 3 would back up the end that information follows the patient ( Federal Register, 2012 ) . To let suppliers clip to follow 2014 certified EHR engineering and fix for Stage 2, all participants will hold a three-month coverage period in 2014. Figure 1: Phases of Meaningful Use Beginning: NeHC University ( 2012 )REQUIREMENTS FOR STAGE 2 IMPLEMENTATIONCore Aims and Menu Aims Fletcher Allen Partners must run into certain demands for a successful Phase 2 execution. The figure of Stage 1 and Stage 2 entire aims remains the same, EPs are must run into the the step of 20 entire aims and CAHs must run into the step of 19 entire aims. However, the combination of aims has changed. Under Phase 2, eligible professionals ( EPs ) must run into the step or measure up for an exclusion to 17 nucleus aims and 3 of 6 bill of fare aims and eligible infirmaries ( EHs ) and CAHs must run into the step or measure up for an exclusion to 16 nucleus aims and 3 of 6 bill of fare aims ( Figure 2 ) . This is a alteration from EP ‘s holding to run into 15 nucleus aims and EHs holding 14 nucleus aims and 5 bill of fare aims severally. About all of the Stage 1 nucleus and bill of fare aims are retained for Stage 2. Figure 2: Changes from Phase 1 to Stage 2 Phase 1 Phase 2 Eligible Professionals 15 nucleus aims 17 nucleus aims 5 of 10 bill of fare aims 3 of 6 bill of fare aims 20 entire aims 20 entire aims Eligible Hospitals & A ; CAHs 14 nucleus aims 16 nucleus aims 5 of 10 bill of fare aims 3 of 6 bill of fare aims 19 entire aims 19 entire aims Clinical Quality Measures needed to be captured by FAP In add-on to run intoing the nucleus and bill of fare aims, eligible professionals, eligible infirmaries and CAHs are besides required to describe clinical quality measures.The clinical quality steps ( CQMs ) are tools used to mensurate and track the quality of health care services by eligible professionals ( EPs ) , eligible infirmaries ( EHs ) and critical entree infirmaries ( CAHs ) within the health care system. The CQMs step many facets of patient attention to include wellness results, clinical procedures, patient safety, efficient usage of healthcare resources, attention coordination, patient battles, population and public wellness, and clinical guidelines.The measuring and coverage of the CQMs guarantee that Fletcher Allen Partners deliver efficient, patient-centered, and safe quality care.A Eligible professionals must describe on 6 entire clinical quality steps: 3 required nucleus steps ( or 3 surrogate nucleus steps ) and 3 extra steps ( selected from a set of 38 clinical qu ality steps ) . Eligible infirmaries and CAHs must describe on all 15 of their clinical quality steps ( CQMS, cms.gov ) . Centers for Medicare & A ; Medicaid Services ( CMS ) selected the recommended nucleus set of CQMs for EPs based on analysis of several factors: Conditionss that contribute to the morbidity and mortality of the most Medicare and Medicaid donees Conditionss that represent national public wellness precedences Conditionss that are common to wellness disparities Conditionss that disproportionately drive health care costs and could better with better quality measuring Measures that would enable CMS, States, and the supplier community to mensurate quality of attention in new dimensions, with a stronger focal point on penurious measuring Measures that include patient and/or health professional battle Get downing in 2014, all Medicare-eligible suppliers in their 2nd twelvemonth and beyond of showing meaningful usage must electronically describe their CQM information to CMS. Medicaid suppliers will electronically describe their CQM information to their province. As Figure 3 shows, EPs must describe on 9 of the 64 approved CQMs. Selected CQMs must cover at least 3 of the National Quality Strategy domains Eligible Hospitals and CAHs must describe on 16 of 29 approved CQMs Selected CQMs must cover at least 3 of the National Quality Strategy domains. Get downing in 2014, all Medicare-eligible suppliers beyond their first twelvemonth of showing meaningful usage must electronically describe their CQM information to CMS informations to CMS. Figure 3: Clinical Quality Measures ( CQMs )SupplierPrior to 20142014 and Beyond*EPs Complete 6 out of 44 Complete 9 out of 64 aˆ?3 nucleus or 3 elevation. nucleus Choose at least 1 step in 3 NQS spheres aˆ?3 bill of fare Recommended nucleus CQMs include:Aaˆ?9 CQMs for the grownup population aˆ?9 CQMs for the paediatric population aˆ?Prioritize NQS spheresAEligible Hospitals and CAHs Complete 15 out of 15 Complete 16 out of 29 aˆ?Choose at least 1 step in 3 NQS spheresAFor 2014, CMS is non necessitating the entry of a nucleus set of CQMs. A Alternatively we identify two recommended nucleus sets of CQMs, one for grownups and one for kids. A We encourage eligible professionals to describe from the recommended nucleus set to the extent those CQMs are applicable to your range of pattern and patient population. Figure 4 shows the recommended nucleus steps: Figure 4: Recommended Core MeasuresAdult Recommended Core MeasuresPediatric Recommended Core MeasuresControling High Blood Pressure Appropriate Testing for Children with Pharyngitis Use of High-Risk Medications in the Aged Weight Assessment and Counseling for Nutrition and Physical Activity for Children and Adolescents Preventive Care and Screening: A Tobacco Use: A Screening and Cessation Intervention Chlamydia Screening for Women Use of Imaging Studies for Low Back Pain Use of Appropriate Medications for Asthma Preventive Care and Screening: A Screening for Clinical Depression and Follow-Up Plan Childhood Immunization Status Documentation of Current Medications in the Medical Record Appropriate Treatment for Children with Upper Respiratory Infection ( URI ) Preventive Care and Screening: A Body Mass Index ( BMI ) Screening and Follow-Up Attention deficit disorder: A Follow-Up Care for Children Prescribed Attention-Deficit/Hyperactivity Disorder ( ADHD ) Medicine Closing the referral cringle: reception of specialist study Preventive Care and Screening: A Screening for Clinical Depression and Follow-Up PlanAAChilds who have dental decay or pits Patient Care Improvements Patient entree to their wellness information is an of import facet of patient attention and battle, and the capablenesss of CEHRT in 2014 and beyond will enable suppliers to do this information available online in a manner that does non enforce a important load on suppliers. Patient engagement – battle is an of import focal point of Stage 2. There are 26 Requirements for Patient Action: More than 5 % of patients must direct secure messages to their EP. More than 5 % of patients must entree their wellness information online. Loss of future gross through authorities inducements Changes to Medicare EHR Incentive Programs The Medicare and Medicaid EHR Incentive Programs provide incentive payments to eligible professionals, eligible infirmaries and critical entree infirmaries ( CAHs ) as they adopt, implement, upgrade or show meaningful usage of certified EHR engineering. Eligible professionals can have up to $ 44,000 through the Medicare EHR Incentive Program and up to $ 63,750 through the Medicaid EHR Incentive Program. The Medicare and Medicaid EHR Incentive Programs provide fiscal inducements for the â€Å" meaningful usage † of certified EHR engineering to better patient attention. To have an EHR incentive payment, suppliers have to demo that they are â€Å" meaningfully utilizing † their EHRs by run intoing thresholds for a figure of aims. CMS has established the aims for â€Å" meaningful usage † that eligible professionals, eligible infirmaries, and critical entree infirmaries ( CAHs ) must run into in order to have an incentive payment. A The Medicare and Medicaid EHR Ince ntive Programs are staged in three stairss with increasing demands for engagement. All suppliers begin take parting by run intoing the Phase 1 demands for a 90-day period in their first twelvemonth of meaningful usage and a full twelvemonth in their 2nd twelvemonth of meaningful usage. After run intoing the Phase 1 demands, suppliers will so hold to run into Stage 2 demands for two full old ages. Eligible professionals participate in the plan on the calendar old ages, while eligible infirmaries and CAHs take part harmonizing to the federal financial twelvemonth beginnning on October 1st. ( EHR Incentive Program, cms.gov ) In order to successfully take part in the plan, EPs, EHs, and CAHs are required to subject CQMs to in order to have an incentive payment in the EHR Incentive Program.Beginning in 2014, the coverage of clinical quality steps ( CQMs ) will alter for all suppliers. EHR engineering that has been certified to the 2014 Edition criterions and enfranchisement standards will hold been tested for enhanced CQM-related capabilities.ELECTRONIC Coverage: In order to let participants to successfully describe CQMs electronically for 2014, CMS is supplying a set of electronic specifications for clinical quality steps ( eCQMs ) for eligible professionals and eligible infirmaries for usage in the EHR Incentive plan for electronic coverage. A These electronic specifications contain multiple parts which allow certified EHR engineering systems to be plan to accurately capture, calculate, and describe clinical quality steps electronically for the 2014 CQMs. A Each eCQM can be described in 3 different ways depending on the intended usage: HTML A – A This is a human clear format so that the user can understand both how the elements are defined and the implicit in logic used to cipher the step. XML – This is a computing machine clear format which enables the machine-controlled creative activity of questions against an EHR or other operational informations shop for quality coverage. Value Sets – Value sets are the specific codifications used by developers to plan the system to accurately capture patient informations in the EHR system. A ATo have the maximal EHR inducement payment, Medicare eligible professionals must get down engagement by 2012.Eligible professionals who demonstrate meaningful usage of certified EHR engineering can have up to $ 44,000 over 5 uninterrupted old ages under the Medicare EHR Incentive Program Incentive payments for eligible professionals are higher under the Medicaid EHR Incentive Payments- up to $ 63,750 over 6 old ages under the Medicaid EHR inducement plan Get downing in 2015, Medicare eligible professionals who do non successfully show meaningful usage will be capable to a payment accommodation. The payment decrease starts at 1 % and increases each twelvemonth that a Medicare eligible professional does non show meaningful usage, to a upper limit of 5 % . The eligibility for the EHR inducement plan is determined by the HITECH Act. The lone eligibility alterations under Phase 2 are under the Medicaid EHR incentive plan. The Phase 2 eligibility. Meaningful usage way for Medicare eligible doctors ( EPs ) : Meaningful usage way for Medicare infirmaries: *Payments will diminish for infirmaries that start having payments in 2014 and subsequently. The alterations from Phase 1 to Stage 2 are as follow: Reporting Period Reduced to Three Months – to let suppliers clip to follow 2014 certified EHR engineering and fix for Stage 2, all participants will hold a three-month coverage period in 2014. â€Å" Phase 2 ends, consistent with other commissariats of Medicare and Medicaid jurisprudence, would spread out upon the Phase 1 standards with a focal point on guaranting that the meaningful usage of EHRs supports the purposes and precedences of the National Quality Strategy. Specifically, Stage 2 meaningful usage standards would promote the usage of wellness IT for uninterrupted quality betterment at the point of attention and the exchange of information in the most structured format possible. Our proposed Phase 2 meaningful usage demands included strict outlooks for wellness information exchange including: more demanding demands for eprescribing ; integrating structured laboratory consequences ; and the outlook that suppliers will electronically convey patient attention sum-ups with each other and with the patient to back up passages in attention. Increasingly robust outlooks for wellness information exchange in Stage 2 and Stage 3 would back up the end that information follows the patient. † Hospitals- FY14 ) Providers-Jan 2014

Human Computer Interaction Individual Report Essay

We as a group we have been set tasks to evaluate an existing system and capture the required improvements that should be made to the system through comprehensive research using the required methods to improve usability of the system. As a group we are to understand the user and capture its needs through numerous of method for example, questionnaire. I within my group decided to evaluate the system (www.pogo.com) as it was thought to inspect the system thoroughly from which some major errors were confronted. To check if these were to reflect the user of the system and that it was effecting the lack of consistent and comprehensive movement from within the site i considered to evaluate the system using ‘Shneiderman’s 8 Golden Rules’ . The evaluation method constructed errors which were found are to be tested with the users and get feedback via the talk aloud and the questionnaire from which I with my group will be able to test the system and capture the user requirements Content Page Paragraph Name Page Number Summary 1 Methods chosen, why 3 Problems Encountered 3 Feedback from users 4 Achievements from the assessment 4 Conclusion/ Recommendations 5 Bibliography/ references 6 Books 6 Web sites 6 Methods chosen, why The interface that chose to evaluate and redesign, was www.pogo.com as this website was not that appealing to me and I think it needs improvements as it is aimed at a family audience. To evaluate the system www.pogo.com it was required to test the system and check if the system had any major error or were they minor problems, in order for me to do this I decided to evaluate the system using the 8 golden rules of Shneiderman’s. The method was used to evaluate the system as this enabled me to test the colour, resolution, text, layout etc†¦ and I thought this method was very useful to appoint out the usability problem that the system was carry to the users. To carry out the evaluation I was first to understand the method and then continue to explore this with the system (www.pogo.com) . The methods used for capturing user requirements were Observation, Questionnaire and talk aloud. These methods were chosen because they were Easy to explore with the system, Cost Effective and Time Effective. Problems Encountered The major problems encountered during the task tests were to find the appropriate user to tackle these tasks. As the methods used were demanding a wide range of user that fitted in the categories of the novice, intermediate and expert users, it was difficult to address the needs of certain user as all categories were involved and from each users view was taken into consideration. There were novice, intermediate and expert that took the task which was a real heap for me as this would help me redesign the interface to fulfil the usability needs. Feedback from users From asking the users to complete the tasks more knowledge was gained for what users expected within a website, from this I was able to point out the like and dislike. From this I also acknowledge that the users prefer their website to be attractive so it is enjoyable to use and users also like to take minimum amount of steps to complete a particular task. The results which I obtained were very useful for redesigning the website. I found out what different usability needs were and what features users wanted to be remained on the website, and any others which they thought required changing. From this information I chose to do a paper based prototype for my system because it was simple, cheap and provided quick feedback from the user. Achievements from the assessment Having completed the assessment I feel that I would be able to explain the usability of any website/interface and from this I am able to identify usability problems such as psychological problems of the system, as well as being able to evaluate any system in depth. From this assessment I have also knowledge how I would explain various methods of capturing user requirements, stating the advantages and disadvantages of the method. Conclusion/ Recommendations If I was to do the assessment again, I would use Shneiderman’s Eight Golden Rules to identify the usability of the system, as I found them very useful both to understand and apply towards the website. I would also use the ‘Ten Heuristics’ to evaluate the website and I would have a great image of usability in evaluating the system. If given a chance in the future to redesign the system I would choose to do a low fidelity prototype but as well as this I would prefer to redesign the website in a high fidelity prototype provided that I am given extra time than provided in my first attempt. The reason for this would be that the users would see the prototype in a low fidelity and will be given a chance then to test the system via a high fidelity prototype. As I only had five users to complete the set task, I was unable to get different views from users to make changes to the redesign. In the future I would ask more users (maybe 10 different users) to complete at least three different tasks. By doing this, the users would experience more interaction with the system www.pogo.com and would comment more on the results they would achieve from the task, and also whether they were able to complete the task accurately, in a minimum amount of time. Bibliography/ references Books User and task analysis for interface design By: JoAnn T. Hackos Janice C. Redish Human computer interaction 3rd addition By: Alan Dix, Janet Finlay, Gregory D. Abowd, and Russell Beale Effective methodology for the study of HCI By: J. Kirakowski and M. Corbett Human-Computer Interaction, 2nd edition, By: Alan Dix, Janet Finlay, Gregory Abowd, Russel Beale Web sites http://www.useit.com/papers/heuristic/ Lecture 3/ Usability/Evaluation Methods/Talk Aloud/Page 15 http://www.ic.sunysb.edu/Class/est571go/ta.html http://hcibib.org/tcuid/ End Page CHI2310 Human Computer Shelley Wolfson

Chapter 19 Solutions

Chapter 19 Completing the Audit / Postaudit Responsibilities |Learning Check | 19-1. The three categories of activities in completing the audit are (a) completing field work, (b) evaluating the findings, and (c) communicating with the client. 19-2. The activities involved in completing the field work are (a) making subsequent events review, (b) reading minutes of meetings, (c) obtaining evidence concerning litigation, claims, and assessments, (d) obtaining client representation letter, and (e) performing analytical procedures. 19-3. a.Subsequent events are events that occur between the balance sheet date and the issuance date of the auditor's report (which is not the same as the date of the report) that may affect the financial statements on which the report is rendered. The subsequent events period extends from the balance sheet date to the end of field work on the engagement. b. The types are: †¢ Type 1 consists of those events that provide additional evidence with respect to conditions that existed at the date of the balance sheet and affect the estimates inherent in the process of preparing financial statements. Type 2 consists of those events that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to that date. †¢ Type 1 events require adjustment of the financial statements. Type 2 events require disclosure, and in very material cases, by attaching pro-form data to the financial statements. c. The auditor is required by GAAS to search for and to evaluate subsequent events up to the date of the auditor's report, which should be as of the end of field work.This responsibility is discharged by (1) being alert for subsequent events in performing year-end substantive tests after the balance sheet date, and (2) performing specific procedures at or near the completion of field work. 19-4. a. Regarding litigation, claims, and assessments (LCA), the auditor should obtain evidential matter o n †¢ The existence of a condition, situation, or set of circumstances indicating an uncertainty as to the possible loss to an entity arising from the LCA. The period in which the underlying cause for legal action occurred. †¢ The degree of probability of an unfavorable outcome. †¢ The amount or range of potential loss. b. A letter of audit inquiry is a letter sent by management to the company's outside legal counsel requesting the lawyer to send specified information directly to the auditor about LCA against the company. The letter is the auditor's primary means of obtaining evidence about LCA. c. When the lawyer fails to respond, the auditor has a scope limitation.Depending on materiality, the auditor will express either a qualified opinion or a disclaimer of opinion. 19-5. a. The objectives of a â€Å"rep† letter are: (1) confirm oral representations given to the auditor, (2) document the continuing appropriateness of such representations, and (3) reduce the possibility of misunderstandings concerning management's representations. b. When the auditor is unable to obtain a rep letter or support a management representation that is material to the financial statements by other audit procedures, there is a scope limitation.Depending on materiality, the auditor will express either a qualified opinion or a disclaimer of opinion 19-6. a. The objectives of an overall review are to assist the auditor in (1) assessing conclusions reached in the audit and (2) evaluating the financial statement presentation taken as a whole. b. The review should be made by an individual having comprehensive knowledge of the client's business and industry. Normally, either the partner in charge of the audit or the top manager on the engagement makes the review. c.Analytical procedures performed during the final stages of the audit should be †¢ Applied to critical audit areas identified during the audit. †¢ Based on financial statement data after all audit adjustments and reclassifications have been recognized. As in other cases, the data may be compared to (1) expected company results, (2) available industry data, and (3) relevant nonfinancial data. 19-7. a. The two objectives in evaluating the findings are determining (1) the type of opinion to be expressed and (2) whether GAAS has been met in the audit. . Four steps in meeting these objectives are: †¢ Making a final assessment of materiality and audit risk. †¢ Making a technical review of financial statements. †¢ Formulating an opinion and drafting the audit report. †¢ Making final review(s) of the working papers. 19-8. a. The purposes of the auditor's final assessment of materiality and audit risk are to determine whether (1) the auditor's preliminary judgments concerning materiality have been met and (2) audit risk is at an acceptable level to warrant the expression of an opinion. . Known misstatement is an uncorrected misstatement in an account identified thr ough substantive tests of details of transactions and balances. Likely misstatement is the total error in an account resulting from (1) known misstatements, (2) projected uncorrected misstatements estimated through audit sampling techniques, and (3) estimated misstatements detected through analytical procedures and quantified by other auditing rocedures. Aggregate likely misstatement is the sum of likely misstatements in all accounts. 19-9. a. Professional standards establish a responsibility for the auditor to evaluate whether there is substantial doubt about the client’s ability to continue as a going concern for a reasonable period of time, not to exceed one year beyond the date of the financial statements being audited (generally one year from balance sheet date).Ordinarily, information that would raise substantial doubt about the going concern assumption relates to the entity's inability to continue to meet its obligations as they become due without substantial dispositi on of assets outside the ordinary course of business, restructuring of debt, externally forced revisions of its operations, or similar actions. b. The auditor normally evaluates whether there is substantial doubt about the client’s ability to continue as a going concern based on the results of normal audit procedures performed in planning, in gathering evidence to support various audit objectives, and in completing the audit. . If the auditor concludes that substantial doubt exists, he or she should consider the need for the following disclosures: †¢ Pertinent conditions and events giving rise to the assessment of substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time. †¢ The possible effects of such conditions and events. †¢ Management's evaluation of the significance of those conditions and events and any mitigating factors. †¢ Possible discontinuance of operations. †¢ Management's plans (includin g relevant prospective financial information). n  3 †¢ Information about the recoverability or classification of recorded asset amounts or the amounts or classification of liabilities. d. If, after considering identified conditions and management's plans, the auditor concludes that substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time remains, the audit report is normally an unqualified audit opinion with an explanatory paragraph about the uncertainty (following the opinion paragraph) to reflect that conclusion.The auditor's conclusion about the entity's ability to continue as a going concern should be expressed through the use of the phrase â€Å"substantial doubt about its (the entity's) ability to continue as a going concern. † If the auditor concludes that the entity's disclosures with respect to the entity's ability to continue as a going concern are inadequate, a departure from generally accepted accounting pr inciples exists. This may result in either a qualified (except for) or an adverse opinion. 19-10.The technical review of the financial statements includes matters pertaining to the form and content of each of the basic statements as well as to required disclosures. Most CPA firms use separate checklists for SEC and non-SEC clients. The auditor who performs the initial review of the financial statements completes the checklists. The manager and partner in charge of the engagement (in the case of a publicly held client then review the checklists, a partner who was not a member of the audit team) reviews them again. 19-11. a. The opinion to be expressed is determined by the partner in charge of the engagement.The decision is made on the basis of the findings made by the audit team during the audit. b. Proposed adjustments and disclosures are discussed with the client and differences are resolved. Ordinarily, agreement is reached and an unqualified opinion can be expressed. 19-12. a. Th e primary reviewers and the nature of their reviews are: |Reviewer |Nature of Review | |Manager |Reviews working papers prepared by seniors and reviews some or all of the working | | |papers reviewed by seniors. |Partner in charge |Reviews working papers prepared by managers and reviews other working papers on a | |of engagement |selective basis. | b. The engagement partner's review of the working papers is designed to obtain assurance that †¢ The work done by subordinates has been accurate and thorough. †¢ The judgments exercised by subordinates were reasonable and appropriate in the circumstances. †¢ The audit engagement has been completed in accordance with the conditions and terms specified in the engagement letter. All significant accounting, auditing, and reporting questions raised during the audit have been properly resolved. †¢ The working papers support the auditor's opinion. †¢ Generally accepted auditing standards and the firm's quality control p olicies and procedures have been met. c. The second partner may be more objective than the partner on the engagement. Thus, the second partner review provides additional assurance that GAAS have been met. Second partner reviews are mandatory for SEC registrants. 19-13.The auditor's communications with the client at the conclusion of the audit involve the audit committee of the board of directors (or the board directly) and management. 19-14. a. Reportable conditions represent significant deficiencies in the design or operation of the internal control structure, which could adversely affect the organization's ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements. The magnitude of a reportable condition determines whether it is also a material weakness.A material weakness is defined as a reportable condition in which the design or operation of the specific internal control structure elements does not r educe to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned duties. b. A report issued on reportable conditions should: †¢ Indicate that the purpose of the audit is to report on the financial statements and not to provide assurance on the internal control structure. Include the definition of reportable conditions. †¢ Include the restriction on distribution (e. g. restricted to the audit committee, management, and others within the organization). In addition, the reportable conditions should be described in one or more separate paragraphs. 19-15. When the auditor separately identifies and describes material weaknesses in his or her report, two additional paragraphs are required. The first paragraph should contain a definition of the term material weakness and a description of the reportable conditions that are material weaknesses.The second additional paragraph should describe the limitations of the auditor's work, noting specifically that the auditor's consideration of the internal control structure would not necessarily disclose all matters considered to be material weaknesses. 19-16. a. The communication may be oral or written, and it may occur during or shortly after the audit. b. The communication with the audit committee may include such matters as †¢ Auditor's responsibilities under GAAS. †¢ Significant accounting policies. †¢ Management judgments and accounting estimates. †¢ Significant audit adjustments. Disagreements with management. †¢ Consultation with other accountants. †¢ Major issues discussed with management prior to retention. †¢ Difficulties in performing the audit. In addition, the auditor must communicate reportable conditions. 19-17. a. The purpose of a management letter is to provide management with recommendations for improving the efficiency and effectiveness of its operations. b. A management letter may include comments on †¢ Internal control matters that are not considered to be reportable conditions. †¢ Management of resources such as cash, inventories, and investments. Other value-added recommendations on how to improve organization performance. †¢ Tax related matters. 19-18. a. The auditor has no responsibility to make inquiry or to perform any auditing procedures on subsequent events occurring after field work but before issuance of the report. When a situation comes to the auditor's attention, he or she is required to evaluate the item and consider its effect on the report that is being issued. b. The auditor may use the event date as the date of the auditor's report provided all subsequent events review procedures are performed for the period between the original report date and the event date.Alternatively, the auditor may use dual dating in which the report contains two dates: (1) the original date of the report, and (2) a date that refers to the subsequent event that has occurred between the original date of the report and the date of its issuance. In this case, it is not necessary to extend performance of all subsequent events review procedures through the later date except as to the particular event giving rise to the dual dating. 19-19. a. The auditor has no responsibility for the postaudit discovery of facts existing at the date of the audit report.However, when the auditor becomes aware of such facts and the facts may have affected the report that was issued, he or she must ascertain the reliability of the information. b. When the client refuses to make the necessary disclosures, the auditor should notify each member of the board of directors of such refusal and take the following steps to prevent further reliance on the audit report: †¢ Notify the client that the audit report must no longer be associated with th e financial statements. Notify the regulatory agencies having jurisdiction over the client that the report should no longer be relied on. †¢ Notify (generally via the regulatory agency) each individual known to be relying on the statements that the report should no longer be relied on. 19-20. a. When the auditor has been able to make a satisfactory investigation and has determined that the information is reliable, he or she should describe the effects the subsequently acquired information would have had on the financial statements and the auditor's report. b.When the client has not cooperated and the auditor has been unable to make a satisfactory investigation, without disclosing the specific information, the auditor should (1) indicate the lack of cooperation and (2) state that if the information is true, the audit report should no longer be relied on. 19-21. a. The auditor has no responsibility to make any retrospective review of his or her work. However, when knowledge is ob tained of possible omitted procedures, the auditor should assess their importance to his or her ability to support the previously expressed opinion. b.The auditor may find that he or she (1) can support the opinion or (2) cannot support the opinion. In the latter case, the auditor should perform the omitted procedures and if necessary prevent further reliance on the report. |Objective Questions | |19-22. |1. b |2. a |3. c | | | |19-23. |1. a |2. b |3. b |4. c | | |19-24. |1. a |2. c |3. b | | | |Comprehensive Questions | 19-25. (Estimated time – 20 minutes) . The first type of subsequent events includes those events that provide additional evidence concerning conditions that existed at the balance sheet date and affect the estimates inherent in the process of preparing financial statements. This type of subsequent events requires that the financial statements be adjusted by any changes in estimates resulting from the use of such additional evidence. The second type of subsequ ent events consists of those events that provide evidence concerning conditions that did not exist at the balance sheet date but arose subsequent to that date.These events should not result in adjustment to the financial statements but may be such that disclosure is required to keep the financial statements from being misleading. b. The auditing procedures Green should consider performing to gather evidence concerning subsequent events include the following: †¢ Compare the latest available interim statements with the financial statements being audited. †¢ Ascertain whether the interim statements were prepared on the same basis as the audited financial statements. Inquire whether there was any significant change in the capital stock, long-term debt, or working capital to the date of inquiry. †¢ Inquire about the current status of items in the audited financial statements that were accounted for on the basis of tentative, preliminary, or inconclusive data. †¢ Inqui re about any unusual adjustments made since the balance sheet date. †¢ Read or inquire about the minutes of meetings of stockholders or the board of directors. †¢ Inquire of the client's legal counsel concerning litigation, claims, and assessments. Obtain a management representation letter, dated as of the date of Green's report, as to whether any subsequent events would require adjustment or disclosure. †¢ Make such additional inquiries or perform such additional procedures as Green considers necessary and appropriate. 19-26. (Estimated time – 30 minutes) a. 1. A subsequent events review is used to provide reasonable assurance that the auditor is aware of significant events that have a material effect on financial statements. These are events that have occurred after the date of the financial statements but before the issuance of the audit report. 2.If the subsequent event is one that provides additional evidence concerning conditions existing at the date of t he financial statements, then the financial statements must be adjusted. If the subsequent event is one that provides evidence concerning conditions that arose after the date of the financial statements, disclosure is required. b. 1. The auditor obtains written representations from the client as part of the evidence gathered to meet the third standard of field work. The purpose of these written representations by management is to †¢ Confirm oral representations given to the auditor. Impress on management that it has the primary responsibility for the financial statements. 2. The client representation letter may include statements concerning the following matters: †¢ Completeness and availability of the accounting records and minutes of meetings of shareholders, directors, and committees. †¢ Absence of unrecorded transactions and errors and irregularities in the financial statements. †¢ Existence of related party transactions or contingencies. †¢ Plans or int entions that may affect the carrying value of assets and liabilities. . 1. The purpose of the management letter is to communicate to management the auditor's recommendations regarding improvements in the efficiency and the effectiveness of matters that came to the auditor's attention during the audit. 2. Three major subjects that may be addressed in the management letter include the following. †¢ Internal control structure weaknesses that are considered immaterial. †¢ Improvements to the accounting and information system. †¢ Improvements to the internal controls related to achieving the objectives of the organization. 9-27. (Estimated time – 25 minutes) |Item No. | |Required Disclosure or | | |Audit Procedures |Entry and Reasons | |1. |Goods in-transit would be detected in the course of the |The receipt of the goods provides additional evidence with | | |auditor's review of the year-end cutoff of purchases.The |respect to conditions that existed at the date of the balance | | |auditor would examine receiving reports and purchase invoices|sheet and hence the financial statements should be adjusted to| | |to make certain that the liability to suppliers had been |take into account such additional information. | | |recorded for all goods included in inventory, and that all | | | |goods for which the client was liable at year end were | | | |recorded in inventory. | |2. |Settlements of litigation would be revealed by requesting |Settlements of litigation would require an adjustment of the | | |from the company's legal counsel a description and evaluation|financial statements since the events that gave rise to the | | |of any litigation, impending litigation, claims, and |litigation had taken place prior to the balance sheet date. | |contingent liabilities of which he or she has knowledge that | | | |existed at the date of the balance sheet being reported upon,| | | |together with a description and evaluation of any additional | | | |matters of a like nature which come to his or her attention | | | |up to the date the information is furnished.A review of cash| | | |disbursements for the period between the balance sheet date | | | |and completion of field work may also reveal evidence of the | | | |settlement. | | | | | | | | | | | | | | | | | | | | | | | | | |3. |The purchase would normally be Revealed in general |The purchase of a new business is not an event that provides | | |conversations with the client and would further be detected |evidence with respect to conditions existing at the balance | | |by reading the minutes of meetings of stockholders, |sheet date; hence, it does not require adjustments in the | | |directors, and appropriate committee.In addition, because |financial statements. However, such an event would normally be| | |the amount paid is likely to be unusually large in relation |of such importance that disclosures of it is required to keep | | |to other cash disbursements, a review of cash di sbursements |the financial statements from being misleading. If the | | |for the period between the balance sheet date and completion |acquisition is significant enough, it might be advisable to | | |of field work is likely to reveal such an extraordinary |supplement the historical statements with pro-forma statements| | |transaction.Moreover, because a purchase of a business |indicating the financial results if the two firms had been | | |usually requires a formal purchase agreement, the letter from|consolidated for the year ending December 31, 19XO. Otherwise,| | |the firm's legal counsel would probably have revealed the |disclosure in footnotes to the financial statements would be | | |purchase. |adequate. Occasionally, a situation of this type may have such| | | |a material impact on the entity that the auditor may wish to | | | |include in the audit report an explanatory paragraph directing| | | |the reader's attention to the event and its effect. | |4. Inventory losses attr ibutable to a flood would be brought to |Losses attributable to floods subsequent to the balance sheet | | |the auditor's attention through inquires and discussions with|date to not provide in formation with respect to conditions | | |corporate officers and executives. Moreover, the auditor |that existed at the balance sheet data; hence, adjustment in | | |would know the location of the plants and warehouses of |the financial statements is not required. However, because the| | |clients and upon becoming aware of any major floods in such a|losses are material, they should be revealed in footnotes to | | |location, he or she would investigate to determine if the |the financial statements. Occasionally, situation of this type| | |client's facilities had suffered any damage. may have such a material Impact on the entity that the auditor| | | |may wish to include in the audit report an explanatory | | | |paragraph directing the reader's attention to the event and | | | |its effect. | |5. |The sale of bonds or other securities would require a filing |Sales of bonds or capital stock are transactions of the type | | |with the SEC in which the auditor would presumably be |that do not provide information with espect to conditions | | |involved. In addition, the sale would be revealed by reading |that existed at the balance sheet date; hence, adjustment of | | |the minutes of directors and finance committee's meetings, by|the financial statements is not required. However, such sales | | |corresponding with the client's attorneys and by examining |may be of sufficient importance to require footnote | | |the cash receipts books in the period subsequent to the |disclosure. Occasionally, a situation of this type may have | | |balance sheet date for evidence of unusually large receipts. such a material impact on the entity that the auditor may wish| | | |to in the audit report an explanatory paragraph directing the | | | |reader's attention to the event and its effect. | 19-28. (Estimated time – 15 minutes) The substantive audit procedures that Young should apply when testing for loss contingencies relating to litigation, claims, and assessments include the following: †¢ Read minutes of meetings of stockholders, directors, and committees. †¢ Read contracts, loan agreements, leases, and other documents. †¢ Read correspondence with taxing and other governmental agencies. †¢ Read correspondence with insurance and bonding companies. Read confirmation replies information concerning guarantees. †¢ Discuss with management the entity's policies and procedures for identifying, valuating, and accounting for litigation, claims, and assessments. †¢ Obtain from management or the client's general counsel a description and evaluation of litigation, claims, and assessments. †¢ Obtain written assurance from management that the financial statements include all accruals †¢ and disclosures required by Statement on Financi al Accounting Standards No. 5. †¢ Examine documents in the client's possession concerning litigation, claims, and assessments, including correspondence from lawyers. Obtain an analysis of professional fee expenses and review supporting invoices for indications of contingencies. †¢ Request the client's management to prepare for transmittal a letter of inquiry to those lawyers consulted by the client concerning litigation, claims, and assessments. †¢ Compare the lawyer's response to the items in the letter of inquiry to the description and evaluation of litigation, claims, and assessments obtained from management. †¢ Determine that the financial statements include proper accruals and disclosures of the contingencies. 19-29. (Estimated time – 25 minutes) 1. Disagree. Generally letters silent on particular aspects of the request letter require follow-up.The auditor should contact the attorney and confirm that he or she intended the letter to completely respond to the request letter and was silent because there were no issues to discuss. Documentation of this confirmation should be included in the working papers. 2. Disagree. A useful evaluation is not always possible. For instance, it may include an element difficult to predict or to which the lawyer may not have paid sufficient attention to make an evaluation. If the matter involved constitutes a material or contingent liability, the auditor will likely conclude there is an uncertainty with effects on the financial statements that can't be determined, and he or she should consider the effects of that uncertainty on the audit report. 3. Disagree.The attorney's opinion is an example of a marginally acceptable opinion. If such an opinion is issued on litigation where loss would seriously impair the company's operations, the auditor must give a qualified opinion and possibly consider a disclaimer of opinion. 4. Disagree. In some cases, attorneys, auditors, and clients discuss matters involv ing litigation, and during such informal discussions some attorneys express their opinions as to the outcome of disputed matters. Such oral opinions should be expressed in writing by the attorney, and if they are not reduced to writing, the discussions generally should not be considered audit evidence. 5. Disagree.The law firm derives all or substantially all of its fees from the client. This is, in essence, analogous to in-house counsel. Evidence from in-house counsel may provide the auditor with the necessary corroboration in some cases. However, since the liability here is great, complete reliance on such evidence is not justified. 19-30. (Estimated time – 25 minutes) Other matters that Alderman's representation letter should specifically confirm that: †¢ The financial statements referred to above are fairly presented in conformity with generally accepted accounting principles. †¢ We have made available to you all— †¢ Financial records and related dat a. Minutes of the meetings of stockholders, directors, and committees of directors, or summaries of actions of recent meetings for which minutes have not yet been prepared. †¢ There are no material transactions that have not been properly recorded in the accounting records underlying the financial statements. †¢ There has been no— †¢ Fraud involving management or employees who have significant roles in internal control. †¢ Fraud involving others that could have a material effect on the financial statements. †¢ Management believes that the effects of any uncorrected financial statement misstatements aggregated by the auditor during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate, to the financial statements taken as a whole. The following have been properly recorded or disclosed in the financial statements: †¢ Related-party transactions, including sales, purchases, loans, transfers, leasing arrangements, and guarantees, and amounts receivable from or payable to related parties. †¢ Guarantees, whether written or oral, under which the company is contingently liable. †¢ Significant estimates and material concentrations known to management that are required to be disclosed in accordance with the AICPA's Statement of Position 94-6, Disclosure of Certain Significant Risks and Uncertainties. †¢ There are no other liabilities or gain or loss contingencies that are required to be accrued or disclosed by FASB Statement No. 5. †¢ The company has satisfactory title to all owned assets, and there are no liens or encumbrances on such assets nor has any asset been pledged as collateral. The company has complied with all aspects of contractual agreements that would have a material effect on the financial statements in the event of noncompliance. †¢ Debt securities that have been classified as held-to-maturity have been so classified due to t he company's intent to hold such securities, to maturity and the company's ability to do so. All other debt securities appropriately have been classified as available-for-sale or trading. †¢ Provision has been made to reduce excess or obsolete inventories to their estimated net realizable value. †¢ Capital stock reserved for options, warrants, conversions, or other requirements have been properly disclosed. 19-31. (Estimated time – 30 minutes) a.The use of overall analytical review at the final stages of an audit has two general advantages to the CPA: (1) a broad view is obtained of the date of the financial statements, and (2) the CPA's attention is focused on exceptions or variations in the data. A broad view of the data under audit is needed by the CPA to draw conclusions about the data as a whole. Merely looking at individual transactions may lead the auditor to overlook important variations in the underlying data. The application of analytical procedures to the final data to obtain this broad view requires a discerning analysis of the data, which results in overall conclusions upon which the CPA's audit satisfaction rests. The CPA is thus able to satisfy him or herself as to the reasonableness, validity, and consistency of the data in view of the surrounding circumstances.The focusing of the CPA's attention on exceptions or variations in the data results in a more efficient and economical audit because there is a reduction in the amount of detailed testing which would be required, in the absence of overall checks, to uncover these exceptions or variations. Furthermore, manipulations of accounts may be revealed because the double-entry bookkeeping system extends the effects of manipulations to additional accounts, which will then bear a changed relationship to other accounts. In addition, managerial problems and trouble spots will be highlighted for the CPA and may lead to the opportunity to be of additional service to the client. b.The ra tios that a CPA may compute during an audit as overall checks on balance sheet accounts and related nominal accounts may include the following: †¢ Accruals of individual expenses to related total expenses. †¢ Calculations of the entity’s operating cycle. †¢ Individual components of return on assets and return on equity. †¢ The impact of an entity’s financing and investing activities. †¢ The ability of cash flow from operations to service debt and dividends. †¢ Other measures of the entity’s liquidity and solvency. c. 1. The possible reasons for a decrease in the rate of inventory turnover include the following: †¢ Decline in sales. Increase in inventory quantities, intentional or unintentional. †¢ Incorrect computation of inventory because of errors in pricing, extensions, or taking of physical inventory. †¢ Inclusion in inventory of slow-moving or obsolete items. †¢ Erroneous cutoff of purchases. †¢ Erroneo us cutoff of sales under the perpetual inventory accounting method. †¢ Unrecorded purchases. †¢ Change in inventory valuation method. 2. The possible reasons for an increase in the number of days' sales in receivable include the following: †¢ Change in credit terms. †¢ Decreasing sales. †¢ Change in the sales mix of products with different sales terms. †¢ Change in mix of customers. †¢ Improper sales cutoff. Unrecorded sales. †¢ Lapping. †¢ Slower collections caused by tighter economic conditions or lowering of the quality of the receivables. 19-32. (Estimated time – 20 minutes) a. Reportable conditions are matters that come to an auditor's attention, which, in the auditor's judgment, should be communicated to the client's audit committee or its equivalent because they represent significant deficiencies in the design or operation of the internal control structure, which could adversely affect the organization's ability to record, p rocess, summarize, and report financial data consistent with the assertions of management in the financial statements.Material weaknesses are reportable conditions in which the design or operation of specific internal control structure elements do not reduce, to a relatively low level, the risk that errors or irregularities in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. b. An auditor is required to identify reportable conditions that come to the auditor's attention in the normal course of an audit, but is not obligated to search for reportable conditions. The auditor uses judgment as to which matters are reportable conditions. Provided the audit committee has acknowledged its understanding and consideration of such deficiencies and the associated risks, the auditor may decide certain matters do not need to be reported unless, because of changes in management or the audit committee, or because of the passage of time, it is appropriate to do so.Conditions noted by the auditor that are considered reportable should be reported, preferably in writing. If information is communicated orally, the auditor should document the communication. The report should state that the communication is intended solely for the information and use of the audit committee, management, and others within the organization. The auditor may identify and communicate separately those reportable conditions the auditor considers to be material weaknesses, but may not state that no reportable conditions were noted during the audit. Reportable conditions may be communicated during the course of the audit rather than after the audit is concluded. depending on the relative significance of the matters noted and -the urgency of corrective follow-up action. 19-33. (Estimated time – 30 minutes) |a. |Deficiency |Proper Wording | |1 . |In completing our audit |In planning and performing our audit | |2. |Its internal control environment |Its internal control structure | |3. |Not to express an opinion |Not to provide assurance | |4. The design and effectiveness |The internal control structure and its operation | | |of the system 0f internal control | | |5. |Under GAAS |Under standards | |6. |Potential weaknesses |Significant | |7. |To prepare financial |To record, process, summarize, and report financial data consistent| | |statements in conformity |with the assertions of management in the financial statements. | |8. For the audit committee |For the information and use of the audit committee, management, and| | |and others |others | b. A reportable condition may be of such magnitude as to be a material weakness. Thus, all material weaknesses are reportable conditions, but all reportable conditions are not material weaknesses. The two terms are defined as follows: †¢ Reportable conditions represent signific ant deficiencies in the design or operation of the internal control structure, which could adversely affect the organization's ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements. A material weakness is a reportable condition in which the design or operation of the specific internal control structure elements does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. c. Two additional paragraphs are required when the auditor refers to material weaknesses in the audit report. The first paragraph should include a definition of a material weakness and a description of reportable conditions that are material weaknesses.The second paragraph should describe the limitations of the au ditor's work; i. e. , that the work would not necessarily disclose all reportable conditions that are also material weaknesses. 19-34. (Estimated time – 20 minutes) a. Independent auditors use a management letter to call to management's attention matters that the auditor has noted during the course of the audit engagement but which did not fall within the scope of the opinion. The management letter provides an excellent vehicle for suggesting value-added services that can assist the business in improving organizational performance. A management letter is rendered as a constructive service to suggest improvements as well as point out deficiencies. b.Many types of information can be covered in a management letter. The major, broad areas which are presented and discussed in the management letter include: †¢ Suggestions for modifying and improving a client's internal controls. †¢ Recommendations for changes and improvements in accounting systems to better meet managemen t's information needs. †¢ Suggestions for improving the management of resources such as cash, inventories, and investments. †¢ Comments regarding tax related matters. A detailed example of a suggestion for improving business practices follows: We understand that your accounting system offers discounts to customers who purchase in significant volumes.The program that grants these volume discounts as it prices a sales invoice does so after important information on gross margins has been reported to department managers. While sales invoices and underlying accounting information is correct, it does not agree with management information that is provided to sales managers as they make pricing decisions. As soon as possible you need to change the program that calculates the sales discounts so that gross margins and other information used by sales management includes the volume discounts offered customers. (Answer updated from original ICMA answer. ) 19-35. (Estimated time  œ 30 minutes) a. 1. 1–subsequent event during the subsequent event period requiring adjustment. 2. 1–subsequent event during the subsequent event period requiring adjustment. 3. –subsequent event during the subsequent event period requiring disclosure. 4. 2–subsequent event during the subsequent event period requiring disclosure 5. 1–subsequent event during the subsequent event period requiring adjustment. 6. 4–subsequent event occurring after field work but before issuance of report. 7. 4–subsequent event occurring after field work but before issuance of report. 8. 5–postaudit discovery of facts existing at date of report. The date field work is completed is not specifically given. This answer is based on the customary practice of dating the audit report as of the end of field work (i. e. , February 26). b.For categories (1) and (2) the auditor has the responsibility for identifying and evaluating subsequent events up to the d ate of the auditor's report. In discharging this responsibility, the auditor should be alert for subsequent events in performing substantive tests, and also perform specific auditing procedures at or near the completion of field work. For categories (3) and (4), the auditor has no responsibility to make inquiry or to perform any auditing procedures during this time period to discover subsequent events. However, if knowledge of such an event comes to the auditor's attention, he or she should determine whether the event requires adjustment of or disclosure in the financial statements. For category (5), the auditor has no responsibility for their discovery.However, if the auditor becomes aware of such facts and the facts may have affected the report that was issued, the auditor is required to ascertain the reliability of the information. c. Information about the items would be obtained from the following: 1. Inquiry of management; client â€Å"rep† letter. 2. Review of bad debt write-offs in January. 3. Reading of minutes. 4. Observation of fire; newspaper account of fire; inquiry of management. 5. Inquiry of management; lawyer's letter; and client â€Å"rep† letter. 6. Reading of minutes. 7. Newspaper story on takeover; inquiry of management. 8. Inquiry of management; lawyer's letter; and client ‘rep† letter.If the client fails to make required disclosure, the auditor should notify each member of the board of directors of such refusal and take the following steps to prevent further reliance on the audit report and: †¢ Notify the client that the audit report must no longer be associated with the financial statements. †¢ Notify regulatory agencies having jurisdiction over the client that the report should no longer be relied on. †¢ Notify (generally via the regulatory agency) each individual known to be relying on the statements that the report should no longer be relied on. |Cases | 19-36. See separate file with answers to the comprehensive case related to the audit of Mt. Hood Furniture that is included with this chapter. NOTE: Several revisions were made to this problem to correct printing errors. The revised problem is posted on the student resources website. | 19-37. (Estimated time – 25 minutes) a. and b. 1. The state government's approval of a plan for the construction of an express highway would have come to the CPA's attention through inquiries of officers and key personnel, examination of the minutes of the meetings of the board of directors and stockholders, and reading local newspapers. The details of the item would not have to be disclosed as a separate footnote because all fixed assets of the corporation, including the right to the condemnation award, were to be sold as of March 1, 19X1. 2.It is improbable that the CPA would learn the source of the $25,000 unless it were revealed in a discussion with the president or his personal accountant, or unless the auditor prepared the pres ident's personal income tax return, in which case the interest charges would have led to his investigation of the use to which the funds were put. Setting out the loan in the balance sheet as a loan from an officer would be sufficient disclosure. The source from which the officer obtained the funds would not be disclosed because it is the officer's personal business and has no effect upon the corporation's financial statements. Indeed, disclosure of the funds' source might be construed as detrimental to the officer. 3. The additional liability for the ore shipment would have been revealed by CPA's scanning of January transactions. The CPA's regular xamination of 19XO transactions and related documents such as purchase contracts would have caused him or her to note the item for subsequent follow-up to determine the final liability. In addition, the client's letter of representation might have mentioned the potential liability. The item would not require separate disclosure by footnot e or otherwise and would be handled by adjusting the financial statement accounts payable by the amount of the additional charge, $9,064 4. The CPA might learn of the agreement to purchase the treasurer's stock ownership through inquiries of management and legal counsel, examination of the minutes of the meetings of the board of directors and stockholders, and subsequent reading of the agreement. The absence of the treasurer might also arouse the CPA's curiosity.The details of the agreement would be disclosed in a footnote because the use of company cash for the repurchase of stock and the change in the amount of stock held by stockholders might have a heavy impact on subsequent years' financial statements. Usually a management change, such as the treasurer's resignation, does not require disclosure in the financial statements. The details underlying the separation (personal disagreements and divorce) should not be disclosed because they are personal matters. 5. Through inquiries of management, review of financial statements for January, scanning of transactions, and observations, the CPA would learn of the reduced sales and of the strike.Disclosure would not be made in the financial statements of these conditions because such disclosure might create doubt as to the reasons therefore and misleading inference might be drawn. 6. The contract with Mammoth Industries would come to the CPA's attention through inquiries of management and legal counsel, reading the minutes of the meetings of the board of directors and stockholders, and examination of the contract. All important details of the contract should be disclosed in a footnote because of the great effect upon the corporation's future. The factors contributing to the entry into the contract need not be disclosed in the statements; while they might be of interest to readers, hey are by no means essential to make the statements not misleading. 19-38. (Estimated time – 25 minutes) The omissions, ambiguitie s, and inappropriate statements and terminology in Brown's letter are as follows: †¢ The action that Consolidated intends to take concerning each suit (for example, to contest the matter vigorously, to seek an out-of-court settlement, or to appeal an adverse decision) is omitted. †¢ A description of the progress of each case to date is omitted. †¢ An evaluation of the likelihood of an unfavorable outcome of each case is omitted. †¢ An estimate, if one can be made, of the amount or range of potential loss of each case is omitted. The various other pending or threatened litigation on which Young was consulted is not identified and included. †¢ The unasserted claims and assessments probable of assertion that have a reasonable possibility of an unfavorable outcome are not identified. †¢ Consolidated's understanding of Young's responsibility to advise Consolidated concerning the disclosure of unasserted possible claims or assessments is omitted. †¢ Mate riality (or the limits of materiality) is not addressed. †¢ The reference to a limitation on Young's response due to confidentiality is inappropriate. †¢ Young is not requested to identify the nature of and reasons for any limited response. Young is not requested to include matters that existed after December 31, 1992, up to the date of Young's response. †¢ The date by which Young's response is needed is not indicated. †¢ The reference to Young's response possibly being quoted or referred to in the financial statements is inappropriate. †¢ Vague terminology such as â€Å"slight† and â€Å"some chance† is included where â€Å"remote† and â€Å"possible† are more appropriate. †¢ There is no inquiry about any unpaid or unbilled charges, services, or disbursements. |Research Questions | For the reasons specified in the introduction to this manual, solutions are not provided for this category of questions.

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Research Proposal Letter - Essay Example However, the number of local curbside recycling programs has also increased from 8,875 in 2002 to over 9,000 today, which has led to a 8 million ton reduction in MSW. This indicates that recycling schemes are effective in reducing disposal rates. However, in 2009 only 82 million tons of this total waste was composted or recycled (33.8%). Baksi and Long (2009) therefore claim that effective waste management strategies are crucial if the US government is to: reduce the amount of household waste being disposed of in land fill sites promote the conservation of natural resources though reducing use of virgin materials increase the amount of household waste being recycled maintain public support decrease the levels of environmental damage caused by landfill sites I therefore believe that recycling issues need to gain serious priority on the government’s agenda and I recommend introducing disposal fees such as ‘unit based pricing systems’ for financing residential trash collection. This is because at the moment many households have zero economic incentive to recycle because they pay for their waste collection and disposal services through general taxation and a fixed rate, thereby undervaluing the price of waste disposal.

HU300 unit 6 DB topic 1 Research Paper Example | Topics and Well Written Essays - 500 words

HU300 unit 6 DB topic 1 - Research Paper Example The idea of this poem is to tell the students that a poem should not merely be read on its face value but they should try to see and feel the character and spirit of the poem. Since the poem is supposed to be an ‘introduction’ it is written in very simple words and hence very easily understandable. The teacher wants the students to appreciate the poem and asks them to approach it in a nonacademic way in which the mere purpose of reading is not just cramming. In the later stanzas, the poet says that his attempt to induce appreciation for the art does not succeed and the students continue to pursue poetry in the same old manner. The poet goes as far as to say that the students merely want some precise message out of it and that they think that there could only be one explanation of the poem whereas poetry is an art form which is enhanced by the interpretation of the reader. The second poem is the ‘Public Transportation’ by Elaine Sexton. The author is an emerging poet who has written a number of poems that have been very well received by the general audience and the critics alike. She conducts poetry workshops and has a passion for inculcating appreciation for this form of literature. Sexton believes that any form of poetry has an inner and a deeper message then what can be gleaned off from the meanings of the words. Her belief is truly represented in this poem where each person has his own background and things are different from what they appear to be. The poem is written out as a story and incorporates very simple vocabulary in its stanzas making it very easy to understand. Even though the title suggests that the poem is about ‘public transportation’, it has a very deep message that everything is not as it looks. The poem itself is an account of the protagonist as she travels in the bus and describes different aspects of it including the surroundings, the different passengers that board the bus

American Apparel Research Paper Example | Topics and Well Written Essays - 2250 words

American Apparel - Research Paper Example American Apparel Major companies, including American Apparel, have come to rely on the sex concept in selling their products to the American public, especially the youth. By incorporating provocative sexual images, their ads, are able to attract young women and men. The company’s chief executive contends that American Apparel’s goal has always been to create a heritage brand for the American public, especially the American pursuit for happiness, property, and liberty. They have been lauded for their ad’s realism since most of their ad subjects are portrayed with their asymmetrical features, imperfections, and blemishes that are attached and highlighted with personal and brief descriptions about them (Welters & Lillethun 65). American Apparel, in addition, rather than outsource their model recruitment, recruits its own ad models from the organization’s stores, on the street, or from photos sent directly to the company’s headquarters via the website. At some point in the past, American Apparel sought to pursue a strategy that dwelt on how the company treated its workers in order to sell the company brand and merchandise, promoting its products as being free of sweatshop activities. The company has also engaged in politically-charged advertisements, such as their anti-immigration laws campaign that referred to current laws as an American variation of apartheid alongside their company logo in 2008 (Welters & Lillethun 66).

Ownership and Control as Important Aspect of the Media Essay Example for Free

Ownership and Control as Important Aspect of the Media Essay Discuss two contrasting theories and relevant studies to explain the extent to which ownership and control is an important aspect of the media. The term mass media is essentially information which is targeted at a large audience. The Mass media is a global industry which has played a major role in shaping society over the 20th century. As technology has developed and created the opportunity to communicate with huge numbers of people, the mass media has developed and with it the media’s impact on society. Over the last fifty years the media has changed its shape yet again to fit in with our increasingly technological society; various forms of new media have appeared: smartphones, laptops, internet and ipods. The general aim of these new mediums is to allow greater flexibility to the user and access media while mobile, also they are not physical forms of media but electronic, which has its own advantages and disadvantages. There have also been major changes in ownership and control of the media; it has become both increasingly concentrated and transnational. An example would be the controversial Mr. Murdoch. His News International group owns over one third of newspapers in Britain, Two other companies, Mirror Group Newspapers and United Newspapers own another 40 per cent between them. This clearly shows that the bulk of the power is held by only a few individuals, this creates very serious political and economical implications. Murdoch’s paper has been partially responsible for getting each government elected over the past fifty years; every party he has supported over the years has won. Two main sociological theories are used to explain ownership and control of the mass media: Pluralist theory and Marxist theory. Each have there own interpretations of the issues and subsequent strengths and weaknesses which I shall now discuss. Pluralist theory is all about power in society. They believe that no one group or elite dominates society. It is essentially a functionalist view. Instead Pluralists believe that there is a range of interest groups who share power. Pluralists argue that the mass media reflect such a range of interests. They argue that the mass media simply reflect what we, the public, want. If it is biased it is because that is the view people want to hear, it simply reflects the publics opinion rather than trying to make people think a particular way. For example the British press is generally conservative; Pluralists argue this is because British society is generally conservative. Pluralists would also say that the mass media provides a wide and diverse choice for the consumer. Therefore there is no single dominant ideology but a genuine choice for the consumer. Minority views are expressed just the same as the dominant views. Because of this Pluralists argue that the mass media has little or no influence on the views of the masses. At most it simply reinforces what people already believe. Pluralism recognizes the ability of the individuals to make up there own mind about key issues. For example, in the general elections of 1997 and 2001 viweing figures dropped sharply during the campaign, suggesting most people had decided who to support before the campaign even started. Furthermore in the 1992 elections the swing to the conservatives was just as great from the neutral Independent as is was from those who read pro-conservative tabloids. Even readers of The Sun, which was strongly against a conservative government, indicated in election polls that they had voted conservative. The Pluralist perspective is criticized for ignoring clear evidence of bias, mainly political bias and the influence it can have on society. For example, the political party supported by Rupert Murdoch’s papers has won every election since 1979. When he decided to switch from Labour to Conservative in 1997, there was a 15 per cent swing to Labour amongst readers of The Sun. This clear evidence of bias due to the views of a single man is ignored by the Pluralist perspective. The impact of the mass media is obviously key to election campaigns and has a massive impact on society as a whole. Arguably Rupert Murdoch alone has been responsible, in part, for getting each government elected since 1979. This clearly is very undemocratic and bad for the country. The Marxist conflict theory views the mass media as a means of not only influencing people, but also controlling them. It is used as a tool by the ruling class to maintain control and power through transmitting a conformist conservative view of the world. Sociologist have created two general views within Marxism, Manipulative Marxism – which places emphasis on the mass media as a form of economic capitalism and Hegemonic Marxism – which emphasises the mass media as a means whereby the ruling class project a culture which reflects their own norms and values, to the exclusion of all others. The concentration of ownership increases such control. Marxists also argue that the ruling class use the media as a filter through which information is passed to the mass of the population. In emphasizing the acceptance of the status quo, the media resists change and therefore works against the interests of the working class. The media therefore will project capitalism positively, creating a false class consciousness to the proletariat to prevent them realizing their exploitation and thus overthrow capitalism. Because of the established media moguls such as Rupert Murdoch it is difficult for small firms and individuals to gain much credit and fame. The Marxist perspective is seen as strong in analyzing the mass media from a conflict perspective. In doing so it helps to explain the mass media as a source of inequality within capitalist society. It also helps to explain the perceived bias within the media. For Marxists this is particularly important in a political and economical context. Marxism identifies and analyses political bias within the media, for example the consumerism culture that the newspapers promote. However, the Marxist theory is criticized for underestimating the ability of individuals to absorb information and make up there own minds about what they agree with or disagree with. Critics argue that people are not like robots who passively accept what they are told, rather they critically judge a variety of issues and make up there own mind using what they have been told and their own individual experience with the issue. James Curran, in Mass Media and Democracy: A reppraisal (1991), argues that the growth of commercial radio and television re-affirms the view that there is a widespread choice with a core public sector combined with an expanding private sector. Thus, the impact of ownership and control is negligible given the real and diverse choice that exists. Currans study supports the Pluralist perspective. Studies such as Curran’s are strong in recognizing the changing nature of British industry and how it applies to the mass media. Such conclusions are supported by the reality of the mass media that, despite a concentration of ownership, is run by a diverse range of individuals from different social backgrounds, through joint stock companies. However, this tends to ignore the fact that the largest proportion of shares in any public liability company is owned by either wealthy individuals or large institutional shareholders. From a Marxist perspective the ruling class is seen as an agent of ideological control in modern society, used by the ruling class to establish and impose its values on the working class. This is a view taking by Miliband in The State in Capitalist Society (1973). Miliband argues that the mass media is an agent of capitalist control, rejecting the pluralist theory that there is genuine choice.

The Human and Professional Values of Managers Essay Example for Free

The Human and Professional Values of Managers Essay The Human and Professional values of Managers: Impact on the profession Some values which can be related to good managers are truth; care, peace, justice and responsibility. Truth is something which is inborn in human behavior. Whether one lives by it or ignores it depends on his upbringing and surrounding factors. A person who has been brought up in an environment where lying was the way of life, will end up doing the same in future even on becoming a manager. Another value is care or love. A manager should care for his employees and respect their feelings. This is a sign of a good manager. A manager should always try to maintain peace at the workplace. He should cultivate the thought of reason and negotiation instead of aggression. Justice is a trait which is required in a manager. He should be able to judge between the right and the wrong for his employees. He should see to it that deserving candidates are rewarded for their hard work. A manager should always bear the responsibility for his actions and not shrug them. It’s generally the manager who is responsible for the subordinates work and he should deal with it and guide his subordinates to perform the best possible work. Leadership Professionalism Effectiveness Innovation Management Public Interest Participation Planning Efficiency 10. Strategy Managers may face a situation when they have to take a choice whether to follow their human or Professional Values. This can be a very tricky decision to take. A situation may arise such as he may know that a certain employee is about to be laid off in a month. But he has order from his superiors not to let him know till the last minute. Now he has to decide whether he will tell the employee the truth or be professional and follow orders. Such decisions have a big impact on the mind of the manager and all people affected by the wrong decision. For a manager, he has to always try to emulate the company values so that all his subordinates can follow his example. He always has to be punctual, responsible, and efficient so that all his subordinates follow his lead. To do might require some compromise on his home front, since to adhere to his values; he might have to work overtime, thus losing out on time spent with his family. But it will certainly cause a positive reaction from his subordinates. A manager will many a times face the dilemma of which employees to reward or relegate. This is another time at which he has to take a decision based on his values. A lot of times, a manager may be in cohorts with an employee and decide to promote him over a more deserving candidate. He may even stick to is human values and promote the right person and ignore his friend and give adequate justice. It may even be a case where you have to lay off a friend when the situation arises. However he may choose not to and not behave in a professional way. Which value will any person choose depends on the situation, consequences and his own characteristics. The Impact of Professional and Human values on managers are huge. They determine the behavior of the manager in his day to day activity. One cannot say which value a manager will employ, but whichever choice he makes determines the personality of the manager. It can lead to success or failure of a manager in his work.

Analysing Aquafina Bottled Water

Analysing Aquafina Bottled Water Aquafina bottled water is bottled around the country in 33 different locations from municipal tap water. It is both filtered and purified in a process that involves seven separate steps called the HydRO-7 Purification System. Included in the steps are processes such as filtration, exposure to high intensity light, osmosis, polishing, and ozonization. What results is water that has a Total Dissolved Solid (TDS) content of 4 parts per million (ppm), 2.5 times lower than the Food and Drug Administration (FDA) maximum amount. The packaging of the water goes through a long process and creates some muda. Many of the Pepsi bottling processes are outsourced. For example, the bottles are manufactured by Amcor PET Packaging North America. The process is also very detailed and complicated in order to ensure both safety and a reliable product. We will also be explaining every material in the packaging process. Additionally, we will be discussing the recent boom of the water industry and its environmental implications over the last decade. The amount of natural resources being used to produce the entire bottled water package, is extraordinary, and causing a real problem. The environment is also being contaminated on a daily basis with a majority of the bottles being thrown away as opposed to being recycled. Along with the destruction of our planet, plastic bottles and the water contained within them are starting to be seen as a serious health threat. For the economical part of this paper, we will touch on Aquafinas numbers over the past few years and try to predict the future. We will also make suggestions on how to gain a bigger market share, and how to make safe products in a business perspective. Pepsi-Colas Aquafina, which has reigned as the number-one brand for several years, has become the U.S. bottled water businesss first billion-dollar brand in 2004 has sustained strong growth in 2005 when wholesale dollar sales neared $1.3 billion. Introduction Bottled water is one of the biggest selling beverages in the world due to its convenience and quality taste. Whether due to the uneasiness of the safety of tap water or the convenience of the bottle, bottled water continues to gain profit share for companies in the industry. Specifically for busy college students such as ourselves, it has become increasingly important for us to be able to drink water when not near a water source. Hence, the product we chose to study is Aquafina bottled water. When one purchases a bottle of Aquafina, he will receive the purified water and the bottle in which it is contained including its label, nutrition facts and ingredients, and a sealed cap. Although the Aquafina water bottle is only meant for one use, many choose to refill their bottle with ordinary tap water. Because Pacific Lutheran University contracts its beverages and vending machines through Pepsi, Aquafina is the most consumed bottled water for our campus. This report is the study of the Aquafina bottled water process, value stream, muda, and economic evaluation of the bottled water that is widely circulated not just on our campus but around the world. The HydRO-7 Purification System Purifying the Water Achieving Aquafina water is a complex and complicated process. Aquafina bottles water in 33 different municipal locations around the country from underground formation springs, the same location as our tap water. Whereas tap water is merely filtered and treated to remove bacteria and contaminants, Aquafina takes an extra step by purifying the water using the Hydro-7 purification system which removes substances according to the Food and Drug Administration (FDA) standards. Creator of the state-of-the-art purification system, the HydRO-7 removes substances in seven different steps. The Aquafina website provides the consumer with information related to the filtration and purification steps of its product (www.aquafina.com). Prefiltration In this first step, the system removes tiny particles in the water through a filter. Polishing filter Here, this first polishing filter (of 2) catches any particles that were missed in the previous step. High-intensity light A burst of high energy light imparts energy into the water stream to eliminate naturally occurring organic substances in the water. Reverse Osmosis (R.O.) Here, the system uses pressure and a hyper filter to remove 98% of Total Dissolved Solids (TDS) and organic compounds from the water. The TDS is the sum of all dissolved solids in water in parts per million. This step uses semi-permeable membranes with smaller pore sizes than micro filtration, ultra filtration, and nano filtration to remove substances such as sodium and chloride from the water. Charcoal Filtration This step isolates the elements that affect the taste of the water in a charcoal filter. Polishing Filter This is where the system polishes the hydrogen and oxygen elements in the water to make the water clear. Ozonization The system passes purified, oxygen-rich air through a generating cell. Here, three oxygen molecules are brought together to keep unwanted particles away. When they have done their job, they revert back to double oxygen molecules. Here is a standard Aquafina nutrition facts label found either on the bottle or the packaging. More important than what is in Aquafina water is what has been removed. The Aquafina website suggests that everything that the system removes from the water is unnecessary and perhaps harmful to humans (www.aquafina.com). The Environmental Protection Agency (EPA) requires a maximum of 500 ppm (parts per million) of TDSs in spring water and the FDA requires 10 ppm in purified water. Aquafina, a purified water, bottles water at 4 ppm, 2.5 times lower than the FDA standard (Mosko, 2004). The process removes the following trace compounds from the water: Carbonates Bicarbonates Chlorides Sulfates Phosphates Nitrates Calcium Magnesium Sodium Potassium Iron Manganese Calcium and potassium are necessary for the human body, but they are still removed. Aquafina claims that the minute levels in the water have little effect on human health and removing them only delivers a more pure water (www.aquafina.com). However at the end of the purification process,  ¼ of the bottled water that Aquafina bottles is tap water (Mosko, 2004). Aquafina claims to have the purest water in the industry, but even more pure and containing less TDS is Penta water, which goes through a rigorous 11-step process and distributes water with 0.5 ppm TDS. Pentas website also explains the process and the advantages of Penta in detail (http://www.pentawater.com/what.shtml). The Aquafina system at the plant in Austin, Indiana, for example, has bottles 32,000 gallons of water an hour. The system is computer monitored and keeps track of which valves are open and closed and how much is in each tank. The Aquafina system is also used for bottling soft drinks at the plant. All the water is carbon-filtered in one of two tanks; the same process is used for all the water that is used in soft drinks, only the Aquafina water goes through the extra step of ozonization (Investing, 2004). Pepsi/Aquafina Bottling The Bottle Pepsi Bottling Ventures LLC (PBV) In July of 2002 the first products were being produced at PBVs new small-bottle PET line in Raleigh, NC in a 200,000 sq ft production/distribution plant. This was a $40 million investment for PBV that gave the company the ability to increase production. PBV has bottling rights for Pepsi products covering most of North Carolina and a portion of Long Island, NY. One of the facilities that upgraded to the PBV production bottling plant was the Raleigh location with the primary goal being the production of bottled water under the Aquafina label, one of the fastest growing products within Pepsi. The need for this upgraded production facility from PBV offers Pepsi the ability to be competitive and cost-conscious (Mans, 2003). Features Individual sanitary enclosures are designed and manufactured by ICS Intl. These contain washing/capping/filling systems on the PET (Polyethylene Terephthalate) lines. The fillers are housed in one room, with a common heating, ventilating and air conditioning system. The PBV plant features an individual sanitary enclosure for each filling system with monobloc filler guards that are integrated into the face of the enclosure. The enclosures have an epoxy floor that is sloped to a stainless-steel drain, vision panels and a complete air-quality control system. The walls and ceiling are made of insulation sandwich panels consisting of inside and outside stainless-steel panels filled with polyurethane foam. The clean rooms come complete with lighting, doors, an air filtration unit, air conditioning, and an air exhaust system. The air-filtration units maintain pressure in the enclosure to prevent outside air from entering (Mans, 2003). Bottles Aquafina uses bottles that are produced by Amcor PET Packaging-North America. Amcor uses PET to make plastic containers for Pepsi products. Amcors website states that this plastic material is manufactured from various by-products of the oil and gas industries, especially ethylene glycol and terephthalic acid. PET consists of carbon, hydrogen and oxygen and can be incinerated without residues for energy recovery. PET is the most valuable of the recyclable plastics. It offers the ability for the container to be lightweight, shatter resistant, resealable and recyclable. The formation of a bottle is blow molded which involves blowing air into a molten plastic tube and then forcing the material to follow the shape of the mold. Injection molding is also involved which is the process of converting plastic pellets by using heat and pressure to inject the molten material into a water-cooled mold. Amcors website explains this technology (http://www.amcor.com/Default.aspx?id=505). Filtration/Sanitation/Air Quality The units have three filtration stages. These stages involve roughing filters, bag filters and HEPA filters for an average air quality of Class 1,000. ICS added an air extractor that sucks the air from the enclosure and ducts it outside the plant to avoid discharging air loaded with sugar or ozone into the surrounding area inside the plant. Air quality is optimized through the limits that are placed on the filler. This also allows the operator to stand outside the room and control the machine (Mans, 2003). Bottling Pre-labeled bottles are delivered to an automatic depalletizer on pallets with cardboard slipsheets between the layers. The depalletizer raises the pallet one layer at a time. A sweep carriage equipped with suction cups swings over and automatically removes the slipsheet and deposits it in a bin for return to the bottle supplier. The depalletizer then indexes the layer of bottles up, and the carriage sweeps the bottles onto a mass bottle conveyor. The bottles on the small-PET (Polyethylene Terephthalate) line are then conveyed in mass to two Lanfranchi high-speed bottle scramblers which have rotating turrets that orient the bottles in an upright position. Level sensors in the hopper of each unscrabler turn delivery elevators on and off to maintain bottles in the hoppers. The bottles from both unscramblers converge in single-file and are injected into the neck-guided air-conveyance system, where the bottles are supported by rods beneath their neck finishes. The bottles are then pushed along the chamber by air blowing. The depalletizing workcell includes three depalletizers and is designed to allow two operators to feed containers to three production lines. Empty bottles are conveyed directly via air conveyor into the sanitary enclosure and the infeed star of the monobloc rinser/filler/capper. All bottle-handling within the monobloc is accomplished by supports under the neck rings of the bottles. The bottles are delivered to the gripping heads of the 108-station rinser through the entrance starwheel, and are turned upside down as the unit rotates. Purified water is sprayed into the bottles through nozzles affixed to the gripping heads, and then drains out as the unit continues its rotation. This solution contains ozone for maximum cleaning efficiency when producing Aquafina. Bottles are then turned upright and discharge through a starwheel that also serves as the delivery starwheel to the filler. The filler for these bottles is an isobaric-volumetric machine with 144 filling valves. Each filling valve is connected to the central tank through a product pipe and two gas pipes connected to the carbon dioxide supply. One pipe is used for the bottle pressurization and the other pipe for the pressure stabilization between the tank and the filling valve. When running Aquafina, the system uses nitrogen instead of carbon dioxide. The level inside the filling cylinder is essentially the same as the level in the central tank, and changes in the quantity of fill for different bottle sizes is accomplished by changing the level in the central tank. A piston in each cylinder is adjusted by an external magnetic coupling to set the exact volume to be filled to an accuracy of  ±2 mL. This is done from the operator panel (Mans, 2003). Capping From the filler, bottles travel through another starwheel into the 36-head Arol CSD screw capper. Caps are supplied by Alcoa and are sorted and delivered to the capper by a system from SIDEL, Packaging Systems Div. Caps are loaded into a hopper located outside of the enclosure. Then a nearly vertical belt carries the caps to the top of the enclosure. Caps are contained on horizontal cleats on the belt and if any caps improperly orient they fall back into the hopper. The belt discharges the caps onto a track that carries them down to the capper. A transfer star picks the caps from the track and places them on the capping head, which then rotates synchronously above the bottle turret. The capping head lowers and screws the cap onto the bottle as the unit rotates. Capped bottles leaving the enclosure pass through an Industrial Dynamics Filtec x-ray fill height inspector. The capped bottles then pass two Videojet Excel ink-jet printers that print a freshness date on the bottle cap tamper ring. The plant has installed two of these units to provide redundancy in case one unit malfunctions. For added security a Domino laser printer applies production codes and a freshness date to the bottle. After being coded the bottles then travel onto a multichain mat-top conveyor that slows their transport speed from 350 to 40 ft/min and accumulates the bottles from single-file to mass (Mans, 2003). Label/ Glue/ Packing /Packaging A HiCone machine produces six-packs of 16- and 24-oz, and 500-mL bottles. The bottles are delivered to the machine in two lanes. The two lanes separate six bottles and apply the plastic carrier material. The material is delivered in a continuous web to a large vertical wheel rotating above the bottles. The wheel pushes the web down onto the six bottles, and it is then cut to separate the six-pack. The packs are then diverted into two lanes and fed to a Hartness 2650 continuous-motion case packer that places four six-packs into reusable plastic crates for delivery to the PBV warehouse for distribution. Bottles can also be conveyed to a packing installation incorporating a Model MW7 multipacker and a Model TDL tray former/loader and shrink wrapper, all supplied by Douglas Machine. Each of these servo-driven machines has its own control panel, with intuitive touchscreen interfaces with real-time production data, maintenance scheduling and changeover settings. Bottles are delivered to the multiwrapper where groups of six or 12 bottles are then wrapped in registered film. This is a dual-stream machine that wraps two parallel groups of bottles simultaneously. Bottles are delivered in mass to the machine and are separated into either six or twelve bottle groupings by a proprietary pinless metering system. The groups are then delivered into the wrapping section. The film is placed around the bottle group and the package is conveyed through a heated shrink tunnel. Four six packs or two twelve packs are then delivered to the tray former/loader. The machine forms a tray from a paperboard blank, pushes the wrapped packs onto the tray, and then seals the open sides with hot-melt glue. This glue is applied by a Nordson glue system. Some 500-mL bottles, as well as 20- and 24-oz bottles of all products can bypass the multipacker and be delivered directly to the tray former/loader. After these are placed on the tray, it travels through a shrink wrapper/heat tunnel. Once the products are packaged, they are conveyed past a Videojet ink-jet case coder for application of production codes and then overhead to an automatic palletizer. Each sku is individually palletized to a designed stacking pattern. Individual packages are delivered to the upper level of the palletizer and are assembled into layers. After each layer is completed the platform is then lowered so the next layer can be assembled. Finished pallet loads are released at floor level and are transported by pallet conveyor to an Orion stretch wrapper. PBV uses plastic pallets that have improved palletizing efficiency and eliminated the debris and floor damage that are usually caused by wood pallets (Mans, 2003). Finished Products/ Reductions of Plant Costs Finished products are stacked two or three high, without pallet racks, and are rotated by code dates. The warehouse has been designed to have twin-load pallet racks in the future that will accommodate four-high stacking. The forklifts are also responsible for placing empty pallets into the palletizers. The PBV plant was specifically designed to allow all raw materials and finished goods to be handled on double forklifts. These forklifts allow two pallets to be picked up at a time and greatly reduce loading and unloading time of the production equipment. The dock equipment was engineered to allow the movement of these extra-wide and heavy loads in and out of the building. The double-fork trucks are also used to load trailers with finished products going to the sales centers, unload return trailers with empty plastic pallets and shells, store empty shells and pallets, and feed empty shells to the three lines. Double-fork trucks greatly reduce the number of forklifts and total travel distance in high-volume beverage plants (Mans, 2003). The Need for Water Vs. The Need for Bottled Water Water is a precious resource and the source of life. Its one that many people take for granted on a daily basis, and because of that, a water crisis has been developing over the last few decades. According to a study done in the year 2000, 346,800 million gallons per day (mgd) of freshwater and 61,200 mgd of saltwater were used in the United States (Water, 2006). Based on these numbers, its figured that the typical American single family home consumes, on average, 69.3 gallons of water per day (Water, 2006). Our daily needs include hydrating ourselves, using in food preparation, flushing toilets, showering, kitchen and bathroom sink purposes, and washing clothes and dishes. These uses attribute to the amount of water consumed, both for purposeful reasons, as well as for wasteful and unnecessary reasons. While hydrating ourselves to keep our body functions working properly does not consist of a large portion of the daily water usage among Americans, it is still an amount that is being used and will never decrease. Human beings need, on average, eight to twelve cups of water per day to replenish the approximately ten cups of water lost each day due to body functions, varying either more or less depending on activity level (Lempert, 2004). Because of this physical need, someone realized that they could profit. This profit realization turned into a multi-billion dollar business we now know as the bottled water industry. The thought that one day human beings would spend money on a bottled version of something that they can get from their own home for a fraction of a cent for the same amount, is mind-boggling but has become the norm. Nothing is created without a need or a want; hence, bottled water was created. Since the U.S. is becoming a more on-the-go society each and every day, Americans rely more and more convenience items. One example of this is the rise of fast food restaurants, which happens to be a factor in the current obesity epidemic in America. So, because of this go, go, go! mentality, many just do not have the time to walk to a sink and fill up a glass with water. They instead need to have it right by their side, only needing to open up a cap and just toss it to the side when it is empty and open up the next thats right there. Another beneficial aspect is in times of emergencies, such as a hurricanes or earthquakes, the water supplies to those areas are usually shut down and/or contamin ated. In which case, bottled water is needed for consumption. Besides the convenience and emergency factors, Americans seem to think that bottled water is a safer, and sometimes, tastier, alternative to tap water. Some people fear coming down with gastrointestinal illnesses, while others fear contaminants, such as pesticides, to enter their bodies (Terry, 2005). People live under the impression that all bottled water is safer to drink than tap water because of a typical misconception, the idea that if it is bottled or packaged by a beverage or food company, then it must be safe. This is an idea that can be argued back and forth. Consumption, Recycling, Physical Harm, and Muda The amount of bottled water being purchased is growing almost exponentially each year. According to a bottled water study, based on the year 2004, Americans consumed 6.76 billion gallons of the pricey beverage (Falcone, 2006). This total amount averaged out to 70 million one-serving bottles being drank each and every day (Falcone, 2006). Consuming that many bottles of water everyday is incredible, and it is no wonder that entrepreneurs are coming up with new ideas all the time on how to get into the bottled water industry. A big reason for the increasing amount of bottled water drinkers is because of, as mentioned earlier, the convenience. It is a lot easier to grab a couple of bottled waters from the refrigerator before going somewhere. Aside from the convenience or laziness factor, the rise in bottled water consumption has begun to have a serious impact on our environment. With the amount of bottled water being produced everyday, there is a high amount of left over product once the water has been drank that must be dealt with. That portion left over happens to be the plastic bottle, something that is not the most earth-friendly item. Of the daily amount of bottled water being consumed, 70 million, 60 million are never recycled (Falcone, 2006). On a daily basis, that means that approximately 86% of bottles are thrown away and sent to a landfill, hurting our environment. This also means that 60 million new plastic bottles have to be created each day to replace those that are thrown in the trash, which amounts to more natural resources being used and more future muda being produced. What is more disturbing is that once these bottles are taken to a landfill, they can take up to 1,000 years to fully decompose (Falcone, 2006). First of all, how is someone able to compute that amount, because, after all, bottled water is a fairly new concept? And secondly, wi th 60 million bottles being added to dumps each day all over the U.S., where are the bottles going to be taken to in ten years, when most likely the amount of bottled waste has doubled, or even tripled? So why is it that the majority of plastic bottles are not being recycled? Many experts say that it is because vehicles are not equipped with recycling receptacles (Falcone, 2006). Since a majority of Americans who purchase bottled water are on-the-go all the time, they have less patience and desire to hold onto their empty plastic bottles until they get to a location where a recycling bin is present. It is easier to just throw them in the trash or on the street. It seems ridiculous that it is easier for people to throw a bottle in the trash as opposed to recycling especially when many places are placing recycling bins next to trash cans. This laziness and lack of patience is causing an extreme amount of harm on the environment. To put this idea into perspective the amount of muda in California created ten years from now would create a two lane, six-inch deep highway that stretches the entire coast of California (Wilson, 2003). During the rare 14% of the time when empty bottles of water are recycled, a lot of good can come from them and it is a step in the right direction in helping the environment. The raw materials used to make the plastic bottles can be saved and used for numerous items which helps to save resources from being destroyed to make new products. By looking at California only, it is estimated that one billion plastic bottles get thrown away over the course of a year (Wilson, 2003). This amount calculates to almost three million bottles being thrown away each and every day (Wilson, 2003). That is an incredible, as well as, disturbing, amount of unnecessary trash. If instead of being thrown away each and every one of those bottles were recycled, the materials reused could produce either 74 million square feet of carpet, 74 million extra large T-shirts, or 16 million sweaters (Wilson, 2003). It is incredible to think that a plastic bottle could be turned into other useful items and help save the environment by not using as many natural resources. Some other interesting information about the recycled material is that five recycled bottles can produce one extra large T-shirt, polyesther carpets can be created from the resin contained within the bottles, and the materials of the bottle can be spun like cotton candy and produce filling for quilts and pillows (Recycling, 2006). By looking over these types of statistics, it paints a wonderful picture of how recycling so much can be saved. Many precious fossil fuels are wasted in this process. The transportation of bottled water to other parts of the U.S. as well as being shipped to other parts of the world uses large amounts of fuel on a yearly basis. This fuel is being wasted on a daily basis for a product that a majority of Americans can get for almost nothing just by turning a knob in their own home (Arnold, 2006). Besides wasting fuel on transportation costs, this same precious resource is being consumed during the packaging process. Polyethylene terephthalate (PET) is the type of plastic most commonly used to produce bottles and just so happens to contain crude oil (Bottled, 2005). According to research, 1.5 million barrels of crude oil is used over the course of a year to be able to produce the amount of bottles Americans demand (Bottled, 2005). Putting this amount into perspective, 1.5 million barrels would be enough to fuel approximately 100,000 cars for an entire year in the U.S. (Bottled, 2005). It is no sho ck that our world is currently dealing with a fuel crisis. By wasting such an extreme amount of oil on the production of bottles and transporting the finished product, we are not only hurting the environment but we are ruining the future for the next generations. Previously mentioned was the apparent safeness of bottled water as opposed to tap water. While in some cases this may be true, tap water can be just as good as bottled and it may even be safer. Many scientific studies have been conducted on bottled water over the years and some of the information found is disturbing. Unlike tap water, which is regulated by the Environmental Protection Agency (EPA), bottled water is classified as a food. Hence, it is regulated by the Food Drug Administration (FDA) (Mosko, 2004). The two groups have different standards in which companies are to follow otherwise harsh consequences result. Some differences are that the FDA does not require products to be tested for coliform bacteria whereas the EPA specifies that no confirmed E.coli or fecal coliform contamination is allowed in tap water (Howard, 2003). Also unlike the EPA, contaminants are not required to be listed after testing whereas additives are required (Mosko, 2004). Since 1990, findings of chem ical contamination and fecal coliform during testing have caused 11 major recalls of bottled water (Mosko, 2004). According to a study done by the World Wildlife Fund, bacterial counts in bottled mineral water can jump 1,000-fold after one week in storage (Mosko, 2004). When bottled water is stored in an un-refrigerated environment for a long period of time, the amount of microorganisms that begin to develop are far greater than the amount contained within tap water (Mosko, 2004). Some water companies, including Aquafina, do not use NSF-certification which tests bottled water for 144 dangerous contaminants (Mosko, 2004). Besides the water being unsafe in many cases, the plastic bottles can also cause a health threat to consumers. When bottled water drinkers notice a taste difference between brands, some of that difference can be attributed to the type of plastic used for the bottle. If the type of plastic used can have an effect on the taste of the water, shouldnt that make a person wonder as to what else the plastic is doing to the water microscopically? One such chemical used in PET bottles, known as Bisphenol-A, is a known endocrine disruptor and carcinogen (Mosko, 2004). This chemical found through testing mixes with the water contained inside the bottle (Mosko, 2004). It is one thing for a person to be inhaling smoke from cigarettes and knowing the possible cancer they are creating within their body. But it is absolutely ridiculous and uncalled for when a person unknowingly harms their body on a daily basis by drinking a product they are told is healthy and necessary for survival. With all of these findings from studies, just how good is that three-dollar bottle of water looking to a person now? Economical and Environmental Analysis in the Business Process First, some numbers on PepsiCo and Aquafina: According to the New York Times, The Pepsi Bottling Group posted better-than-expected profit April 18th as strong sales of Aquafina bottled water and Lipton Ice Tea brands in North America offset rising costs for raw material and fuel (Pepsi, 2006). The company had net income of $34 million, or 14 cents a share, compared with $39 million, or 15 cents a share, in the period a year earlier. Earnings were 3 cents ahead of analysts average forecast of 11 cents a share, according to Reuters Estimates. Excluding stock option expense, Pepsi Bottlings profit was 18 cents a share. The company, which is 43 percent, owned by PepsiCo Inc., said revenue rose to $2.37 billion from $2.15 billion. In the United States, sales of noncarbonated beverages, excluding water, grew more than 20 percent in the quarter while sales of Aquafina water grew about 35 percent. Pepsi Bottling said first-quarter sales by volume, a crucial gauge of performance in the bevera ge industry, rose 6 percent worldwide as well as in the United States and Canada. The company said worldwide net revenue per case grew 4 percent, fueled by price increases in the United States that helped offset a 9 percent jump in selling, delivery and administrative expenses (The New York Times, April