Management Responsibilities and Forensic Accounting - Research Paper Example

Management Responsibilities in Relation Forensic Accounting For a business success, a manager should work toward ensuring that they carry out all their management responsibilities. The business success, therefore, depends on the skills that managers use to ensure that the management responsibilities are carried out. The management responsibilities can be done concerning various business issues like forensic accounting. Forensic accounting is also termed investigative accounting, is the application of concepts of accounting and techniques of accounting to legal problems. The forensic accounting inspects and documents monetary fraud and crimes of white-collar like embezzlement. Moreover, they offer litigation assistance to attorneys and agencies of regulations enforcement investigating financial crimes (Abdolmohammadi, pp 13). The management responsibilities can, therefore, be done in regard to forensic accounting. One key management responsibility involves the strategic planning for the business. For the business to succeed, the management should guarantee that they embark on the strategic planning of the affairs of the business. Strategic planning enables a business to formulate the objectives of the business (Emerald Journal). In strategic planning forensic accounting is also included so that the capital invested in the business is correctly used. In case of a mismanagement of the capital then it is noticed at an earlier stage before it creates a severe problem to the management and business. The supervising and evaluation of the overall performance of the business is also a chief management responsibility. The operation of a business includes many performances, which are carried out by different departments of a business. The management does the evaluation of the activities of each branch and management through the supervisors does the monitoring of the operations of the each department. This is to ensure that the operations of the business are done in accordance to the strategic plans. The management further ensures that evaluation is effective through using forensic accounting to make sure that no fund from each department is embezzled. The forensic accounting is majorly used in evaluation at the financial department because this department is responsible for all the assets of the business (Arokiasamy, Koh and Suat, pp 146). The management responsibility is also to ensure that all the employees uphold high conduct standards. The conduct of the employees determines the image that the public has about a business. It is, therefore, significant for the administration to ensure that the entire employees have high conduct standards. The conduct of the employees also determines the performance of the business because the employee’s conduct will determine whether the business’ funds will be properly used. One way through which a business ensures ethical conduct of employees, especially in the accounting department, is via using forensic accounting. Since this method is highly effective, the employees will thrive to maintain high conduct to avoid being blamed for fund embezzlement. The management also evaluates and influences the actions and decisions of the business. Te decisions are evaluated to certain that they will be effective and useful to the business. The management influences the actions and decisions of the business because it is they who decide the actions and decisions to be taken. The actions of the business either can influence positively or can influence negatively on the business; therefore, their evaluation is significant purposely for the success of the business. The evaluation of the decisions is also significant because it ensures that the correct decisions are used to guide the business actions hence a success in the business. For instance, in accounting, the decisions made have to be properly evaluated because failure to do that can result loss of money through either misuse or embezzlement. Furthermore, the management has to influence the decisions made in the financial department so that they ensure that the department follows the plans strategized. The forensic accountants should be employed to help the business in ensuring this duty and dealing with the employees of other departments employees who misuse the organizations funds. The fulfillment of the key roles is also a management role. The key roles of a business include the interpersonal roles, informational roles and decisional roles. The interpersonal roles somehow concerns individuals, but the other two roles involve the entire organization. Failure to fulfill the roles of the business can lead to failure or collapse of a business. For instance, in accounting, neglect of duty can result to some money being misplaced. It can also give the indiscipline employees the chance to do fraud (Arokiasamy, Koh and Suat, pp 147). Situation at times arises where the fraud or misplacement of business money occurs, and the management fails to notice such occurrences. The management therefore, employs forensic accountants to assist in the detection of these problems in case they take place. Management responsibilities are primarily for the assurance of fair and reasonable return rate on capital and fair investment returns. This can be determined based on the differences of business risks in various activity fields. With business growth, the shareholders can expect elevation in their capitals value. However, the fair and reasonable return rate on capital and fair investment returns can be achieved more easily if the forensic accounting is used to check on the use of the capital injected in the business by the shareholders. Management responsibility to the employees involves the employees’ fair salaries and wages, suitable work surroundings, work force management relations and welfare of employees. Fair wages must be fixed considering productivity of labor, the prevailing wages rate in similar or neighboring places and relative significance of jobs. The salaries and allowances of the managers are anticipated to be connected to their responsibilities, skills and plans. However, the spread amid maximum salaries and minimum wages are to be reasonable. The workers are anticipated to put up and uphold harmonious relationships amid superior and the lesser. The other responsibility aspect toward the employees is a stipulation of welfare services like security of the conditions of work, medical facilities, retirement benefits, housing, and leave (Context Journal). This responsibility can, however, not be effected incase financial crimes are included in the operations of a business organization. Forensic accounting can therefore, be applied to the wages and salaries sectors to ensure no money is embezzled. The other management responsibility is the responsibility toward the consumers. In competitive markets, customer service should always be a paramount concern of management for the business to succeed (Context Journal). However, the reality is that perfect competition never prevails in most product markets. In the occasion of supply, shortage there exist no automatic modification. Moreover, the customers are regularly victims of unwarranted practices and unprincipled business conducts. The interests of consumers are, therefore, protected to some degrees with rules and pressure from organized groups of consumers. The management is supposed to expect these developments, protect the interest of consumers, and satisfy the needs of the consumer. The standard and value of goods should be appropriate and be accessible in enough quantities at rational prices. Management ought to avoid optioning to hoarding or making artificial scarcity with the inclusion of false and deceptive advertisements. The responsibility toward the customer, therefore, involves the use of much cash and incase the business money is embezzled these customer operations can be effected. The management of a business should therefore, use the forensic accounting to minimize the occurrences of these problems. Management responsibility also includes the responsibility toward the government. The management should conduct the affairs of the business in a lawful way, avoid corrupting the public officials purposely for selfish gain and should pay all the duty and taxes. The activities of businesses ought to verify to the public policies and economic policies of the government. The business can further ensure this by applying the forensic accountant into its affairs. This will minimize fraud hence the government will not have many cases of crimes in its business sectors. Business ventures are like individuals of society and ought to react to the society’s demands. If the organization does not respond to changes in public demands, either the public will compel them to respond via laws or they will not authorize the survival of the enterprise. Therefore, the long-term of business’ interests are served well when the management presupposes social responsibilities. The reflection of a business organization linked with the product’s quality and clients service, and the degree to which it accomplishes the prospects of proprietors, employees, government, customers and the society. For long-term success, it involves an immense deal if the business has a positive picture in the mind of the public. Every business is a society’s organ and its activities have effects on the public scene. Therefore, it is vital for the management to regard whether their rules and activities are possible to endorse the good of the public, advances the essential principles of society, and make up to its strength, stability and harmony. Moreover, for the business to ensure the public demands are met accordingly the proprietor of the business should investigate all the accounts of the business. This will help in accounting for all the cash used for meeting all customers’ demands. Management responsibility is also steered toward the community or society. The socially accountable management role in relation to the society are anticipated to be exposed by its rules with regard to handicapped person’s employment, and the community’s minor sections, protection of the environment, control of pollution, starting industries in underdeveloped areas, and giving relief to the natural calamities’ victims (Emerald Journal). This can be made with regard to forensic accounting through checking the usage of business assets used purposefully for developing the community. This will ensure that not all the efforts of management to assist the community are in vain hence the PR of management and the business gains a positive outlook. Conclusion In summary, all the management responsibilities should be carried out if the management of a business or an organization aims at being successful. It is also clear that forensic accounting contribute to the business or organization achievement because it helps in dealing with the cases of fraud in the business. Moreover, the forensic accounting assists the managers in ensuring that all the funds of the business are accounted for perfectly. The mangers should, therefore, work toward achieving all their responsibilities so that the business can thrive, assist the society, gain a positive public view, create more employment opportunities, and improve the economy of a country. Works Cited Abdolmohammadi, M. “Corporate governance ratings and financial restatements: Pre and Post Sarbanes-Oxley Act”. Journal of Forensic & Investigative Accounting. 2010. Vol 2(1): 1-44. Arokiasamy Lawrence, Koh Adrian Nicholas and Suat Cristal Lee Ah “Forensic Accounting: Public Acceptance Towards Occurrence of Fraud Detection.” International Journal of Business Management. Nov, 2009. Vol 4. 145-148. "Emerald | Journal of Global Responsibility information." Emerald. N.p., n.d. Web. 27 Apr. 2012. . "Roles & Responsibilities | Context Journal." Welcome to Context Journal | Context Journal. N.p., n.d. Web. 27 Apr. 2012. . Read More