The Auditor\u27s Responsibilities for Fraud Detection and Disclosure: Do The Auditing Standards Provide A Safe Harbor?

Eighty-seven percent of managers recently surveyed were willing to commit financial statement fraud. More than half were willing to overstate assets, forty-eight percent were willing to understate loss reserves and thirty-eight percent would pad a government contract. These disturbing results are underscored by the financial miseries still brewing in the savings and loan industry, as well as by other corporate and banking financial debacles of the past decade, including Lincoln Savings & Loan, Wedtech, and the Delorean sports car venture scandal. Amidst these financial ruins we find the chronic element of management fraud. Unfortunately for investors and depositors a troublesome number of these financial disasters have followed a clean bill of health from the company auditors, thus leaving investors, depositors, and creditors looking on in despair. As the investing public labors over its lost investment and nervously contemplates its next move, one question inevitably comes to mind: Who is watching over the financial statements of corporate America? More precisely, where are the auditors? The investing public has long expected and relied upon the independent audit to uncover and disclose employee embezzlement and fraudulent reporting by management. Certified public accountants (CPAs) who perform these audits, however, have traditionally refused to accept primary responsibility for providing this needed service. Indeed, the auditing profession has consistently sought to limit its responsibility and liability in this area by establishing auditing standards that place substantial restrictions on the auditor\u27s duty to detect fraud. CPAs maintain that these self-imposed auditing standards define the contours of their responsibilities, and thus the degree to which the public can rely upon the audit to reveal fraud. According to CPAs, as long as a CPA has performed the audit in compliance with generally accepted auditing standards (GAAS) and the financial statements were presented in accordance with generally accepted accounting principles (GAAP), the CPA\u27s responsibilities have been fulfilled. Thus, many in the auditing profession maintain that the professional standards provide a safe harbor for auditors, permitting CPAs who faithfully comply with the professional standards to effectively immunize themselves from liability. The extent to which CPAs can actually insulate themselves from liability has been the subject of much heated debate, a debate that is likely to resurface with the 1989 promulgation by the American Institute of Certified Public Accountants (AICPA) of Statements On Auditing Standards (SAS) No. 53, The Auditor\u27s Responsibility to Detect and Report Errors and Irregularities. SAS No. 53 is the latest in a series of auditing standards that attempt to define the CPA\u27s responsibility for detecting fraud, and represents the culmination of an intense effort by the AICPA to stem a growing tide of public criticism and suits against auditors. SAS No. 53 differs from prior auditing standards on management fraud by acknowledging for the first time that an auditor has an affirmative obligation to detect fraud. Under SAS No. 53 the CPA must now design the audit to provide reasonable assurances of fraud detection. The AICPA undoubtedly hopes that courts will, in time, apply SAS No. 53 as the measure of liability for CPAs when they are sued for failing to detect or disclose management fraud, thereby providing auditors with a safe harbor and some certainty in this volatile area of auditor liability. Lawyers who represent CPAs will soon be asked to advise their clients on whether CPAs can fortify themselves against liability by complying with this new standard. This Comment endeavors to provide guidance by ascertaining the evidentiary role SAS No. 53 is likely to play in future malpractice suits

Cut-off rate calculations for the outer channel in a concatenated cooling system

Concatenated codes were long used as a practical means of achieving long block or constraint lengths for combating errors on very noisy channels. The inner and outer encoders are normally separated by an interleaver, so that decoded error bursts coming from the inner decoder are randomized before entering the outer decoder. The effectiveness of this interleaver is examined by calculating the cut-off rate of the outer channel seen by the outer decoder with and without interleaving. Interleaving never hurts the performance of a concatenated code, and when the inner code rate is near the cut-off rate of the inner channel, interleaving significantly improves code performance

Compton Scattering in Ultra-Strong Magnetic Fields: Numerical and Analytical Behavior in the Relativistic Regime

This paper explores the effects of strong magnetic fields on the Compton scattering of relativistic electrons. Recent studies of upscattering and energy loss by relativistic electrons that have used the non-relativistic, magnetic Thomson cross section for resonant scattering or the Klein-Nishina cross section for non-resonant scattering do not account for the relativistic quantum effects of strong fields ($> 4 \times 10^{12}$ G). We have derived a simplified expression for the exact QED scattering cross section for the broadly-applicable case where relativistic electrons move along the magnetic field. To facilitate applications to astrophysical models, we have also developed compact approximate expressions for both the differential and total polarization-dependent cross sections, with the latter representing well the exact total QED cross section even at the high fields believed to be present in environments near the stellar surfaces of Soft Gamma-Ray Repeaters and Anomalous X-Ray Pulsars. We find that strong magnetic fields significantly lower the Compton scattering cross section below and at the resonance, when the incident photon energy exceeds $m_ec^2$ in the electron rest frame. The cross section is strongly dependent on the polarization of the final scattered photon. Below the cyclotron fundamental, mostly photons of perpendicular polarization are produced in scatterings, a situation that also arises above this resonance for sub-critical fields. However, an interesting discovery is that for super-critical fields, a preponderance of photons of parallel polarization results from scatterings above the cyclotron fundamental. This characteristic is both a relativistic and magnetic effect not present in the Thomson or Klein-Nishina limits.Comment: AASTeX format, 31 pages included 7 embedded figures, accepted for publication in The Astrophysical Journa

A Five-coordinate Metal Center in Co(II)-substituted VanX

In an effort to structurally probe the metal binding site in VanX, electronic absorption, EPR, and extended x-ray absorption fine structure (EXAFS) spectroscopic studies were conducted on Co(II)-substituted VanX. Electronic spectroscopy revealed the presence of Co(II) ligand field transitions that had molar absorptivities of ∼100 m–1 cm–1, which suggests that Co(II) is five-coordinate in Co(II)-substituted VanX. Low temperature EPR spectra of Co(II)-substituted VanX were simulated using spin Hamiltonian parameters of M = |±½〉, E/D = 0.14, greal(x,y) = 2.37, and grealS(z) = 2.03. These parameters lead to the prediction that Co(II) in the enzyme is five-coordinate and that there may be at least one solvent-derived ligand. Single scattering fits of EXAFS data indicate that the metal ions in both native Zn(II)-containing and Co(II)-substituted VanX have the same coordination number and that the metal ions are coordinated by 5 nitrogen/oxygen ligands at ∼ 2.0 Å. These data demonstrate that Co(II) (and Zn(II) from EXAFS studies) is five-coordinate in VanX in contrast to previous crystallographic studies (Bussiere, D. E., Pratt, S. D., Katz, L., Severin, J. M., Holzman, T., and Park, C. H. (1998) Mol. Cell 2, 75–84). These spectroscopic studies also demonstrate that the metal ion in Co(II)-substituted VanX when complexed with a phosphinate analog of substrate d-Ala-d-Ala is also five-coordinate

Topological Defects in Twisted Bundles of Two-Dimensionally Ordered Filaments

Twisted assemblies of filaments in ropes, cables and bundles are essential structural elements in wide use in macroscopic materials as well as within the cells and tissues of living organisms. We develop the unique, non-linear elastic properties of twisted filament bundles that derive from generic properties of two-dimensional line-ordered materials. Continuum elasticity reveals a formal equivalence between the elastic stresses induced by bundle twist and those induced by the positive curvature in thin, elastic sheets. These geometrically-induced stresses can be screened by 5-fold disclination defects in lattice packing, and we predict a discrete spectrum elastic energy groundstates associated with integer numbers of disclinations in cylindrical bundles. Finally, we show that elastic-energy groundstates are extremely sensitive to defect position in the cross-section, with off-center disclinations driving the entire bundle to buckle, adopting globally writhing configurations.Comment: 4.1 pages; 3 figure

Tracking ground state Ba+ ions in an expanding laser–plasma plume using time-resolved vacuum ultraviolet photoionization imaging

We report results from a study of the integrated column density and expansion dynamics of ground-state-selected Ba+ ions in a laser–plasma plume using a new experimental system—VPIF (vacuum-ultraviolet photoabsorption imaging facility). The ions are tracked by recording the attenuation of a pulsed and collimated vacuum ultraviolet beam, tuned to the 5p–6d inner-shell resonance of singly ionized barium, as the expanding plasma plume moves across it. The attenuated beam is allowed to fall on a CCD array where the spatial distribution of the absorption is recorded. Time-resolved ion velocity and integrated column density maps are readily extracted from the photoionization images

International photovoltaic program. Volume 2: Appendices

The results of analyses conducted in preparation of an international photovoltaic marketing plan are summarized. Included are compilations of relevant statutes and existing Federal programs; strategies designed to expand the use of photovoltaics abroad; information on the domestic photovoltaic plan and its impact on the proposed international plan; perspectives on foreign competition; industry views on the international photovoltaic market and ideas about the how US government actions could affect this market;international financing issues; and information on issues affecting foreign policy and developing countries

A spectrum of approaches to health information interaction: From avoidance to verification

People respond to illness in a range of ways, and take different approaches to engaging with health information throughout the course of their illness. This study describes and explains the variety of approaches to health information interactions made by patients on hemodialysis. Ethnographic observations (156 hours) were conducted in three hemodialysis clinics, and semistructured interviews about health information were held with 28 patients. Demographic data were collected. Data were analyzed qualitatively. We found a spectrum of five approaches to health information: avoiders, who close themselves off from health information; receivers, who encounter information in the dialysis clinic but do not seek it out; askers, who only pose questions about health to their healthcare providers but otherwise do not seek; seekers, who actively look for health information both in and out of the clinic; and verifiers, who seek information and triangulate it among multiple sources. Trust in healthcare providers and coping sociality differed across approaches. The findings indicate that health information should be provided to patients using strategies tailored to their preferences and existing approaches to information interaction.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/156165/2/asi24310_am.pdfhttp://deepblue.lib.umich.edu/bitstream/2027.42/156165/1/asi24310.pd

Social Media as an Innovative Policy Tool: Lessons and Recommendations from the City of Austin

Social media brings opportunities for local governments to innovatively engage the public to enhance service delivery. Using the City of Austin, Texas as a backdrop, we assess the Austin Police Department’s utilization of social media in its communication efforts around community policing. This assessment develops a practical model to evaluate its community policing communication policies and practices by way of social media. The findings from this assessment provide several lessons and recommendations for practitioners to use in their efforts to integrate social media into public service delivery. These lessons and recommendations drawn from this case can provide an example of the potential strengths and weaknesses behind incorporating social media within public service delivery