Week 3 Discussion Responses

· APA 6th, cited

· Spell Checked and Grammar Verified

· BE supportive

· Disagree respectfully

· Back up opinion with sources

· Post responses on 2 separate Word Docs per course

Week 3 Discussion Responses Financial Accounting

Discussion Response 1:

By: N,M

When reviewing Leslie Fay’s company in regards to the series of decisions that led to its demise, the root of the issue initially stemmed from the challenges that developed from consumers’ distaste for the over-priced, poorly designed clothing products that were heavily advertised as a quality item that did not exist. Leslie Fay announced a series of retailer-based discounts and subsequently shifted its focus to promoting inflated sales comparatively to nixing other operational costs; ultimately, this strategy led to the belief that the company’s success was profitable but only left the divide wider, allowing more room for hypocrisy to fester (Silverman, 2010).

Internal operations were not monitored and management was given complete financial autonomy which subsequently led to falsified transactions, cash pay-outs for key stakeholders, and a promotion of a brand that was undoubtedly flailing to maintain competitiveness within the marketplace (Strom, 1993). While Leslie Fay’s executives uninvolved in the falsifying denied all acknowledgement of the situation, the inflationary decisions, invoices masked as revenue, and overstatement of inventory led to skeptics to dive in, ultimately blaming Paul Polishan, the CFO; ultimately, this led to the fraud to be uncaught for a significant amount of time as Leslie Fay attempted to pin-point the issue. To avoid this happening again, internal leadership would need to move towards a more comprehensive accounting system, all new senior-level executives would need to be hired to maintain a checks and balances approach to finance, and an external auditing team would need to be utilized.


Silverman, D. (2010). What Leslie Fay’s Former CEO Learned from His Company’s Bankruptcy. Harvard Business Review. Retrieved on September 13, 2017 from https://hbr.org/2010/04/what-john-pomerantz-former-ceo

Strom, S. (1993). Leslie Fay Releases Scandal Audit Results. NY Times. Retrieved on September 13, 2017 from http://www.nytimes.com/1993/09/30/business/company-news-leslie-fay-releases-scandal-audit-results.html?mcubz=0

Discussion Response 2:


Leslie Fay manufacturing company was formed in 1947 by Fred Pomerantz as women’s clothing manufacturer.  In January 1993, it was discovered that major accounting frauds had been conducted over several years by Donald Kenia, the controller at Leslie Fay.  In further investigation, the audit committee discovered that the controller and his subordinates had inflated the inventory numbers.  The number of dresses manufactured each quarter had been inflated to reduce the cost per unit of the finished product and inventory recorded in the previous periods.  Additionally, inventory tags were forged for non-existent products during period-ending inventory physical counts and large amounts of inventory in transit were also fabricated.

It was also discovered that the financial controller had violated certain GAAP principles such as failing to accrue expenses and liabilities at the end of the accounting period, failing to write off bad debts, ignoring discounts on outstanding receivables offered to customers who had experienced trouble selling Leslie Fays’ products and recording false orders from customers in order to boost sales.  In addition to this, the financial controller and his subordinates misrepresented the profits of the company and fabricated the numbers to ensure that when financial ratios were calculated, they would be consistent with the historical trends.  The company’s auditor BDO Seidman relied heavily on the historical trends and failed to conduct analytical procedures such as comparing Leslie Fay’s performance with that of its competitors, thus allowing the frauds to go unnoticed.

Internal controls play a key role in allowing frauds within the company to be discovered.  Some of the internal control procedures that may be implemented to prevent inventory fraud within a company include; carrying out a surprise physical inventory count in the company, independent confirmation of the existence and accuracy of accounts receivables by contacting a sample of the  debtors, restricting access to the company’s warehouses and issuing goods only after an approved release slip has been produced and using accounting software’s with high-security features which cannot be manipulated to keep track of inventory (Hamilton, n.d).

Works Cited:

Case 1.5: Leslie Fay Companies (n.d). Retrieved from http://docshare01.docshare.tips/files/12155/121554303.pdf

Hamilton, C. (n.d). Inventory Fraud: Detecting, Preventing & Prosecuting. Retrieved from http://www.arxisfinancial.com/images/pdfs/Inventory_Fraud.pdf

Week 3 Discussion Responses International Business

Discussion Response 1:

By: S,B

The World Trade Organization, WTO, is a group formed to increase and ease trade around the world (WTO, 2017).  Most countries, 164, collaborate with the WTO (WTO, 2017).  The governments of these counties can use the WTO for help with trade negotiations and also review of potential infringement of the rights within those agreements (WTO, 2017).  The WTO works with governments to provide transparency to their trade agreements for counties (WTO, 2017).  The WTO actively works with developing counties to increase trade which may help counties economies grow (WTO, 2017).  The WTO also helps in negotiating for these developing counties (WTO, 2017).  The WTO does have multiple programs, one of which is the Aid for Trade.

The WTO generates an bi-annual reports to provide transparency for the program.  Most of the data comes from self-reported values from the involved county’s themselves (WTO, 2017b).  Annual, counties contribute 25-30 billion dollars to the program for developing counties (WTO, 2017b). Other organizations (e.g. Non-governmental organizations) work with and are engaged by WTO to help facilitate trade and promote the program (WTO, 2017b). In Geneva Switzerland, The WTO generally has a few educational and update workshops for interested stakeholders to be engaged throughout the year.  These workshops provide an overview of polices, results from monitoring, topics of interest to increase trade and remove barriers (WTO, 2017b).

Aid for Trade is a program to help developing nations grow and stabilize supply shortages.  This is done through trade and/or aid from mostly developed nations (WTO, 2017c).  The program does not necessarily mean good are transferred to help buffer a county’s internal lack of supply.  But rather, the program helps facilitate growth in supply of goods.  This could mean training, increased supply of raw materials, better infrastructure to get goods to the shortage locations (WTO, 2017c).   Free open trade does not benefit one country over another.  Instead, trade benefits both counties because consumers will pay for products at a relatively lower cost.  Also, if supply meets the demand of a county for basic goods (e.g. food products), a potentially new market for other non-basic goods could be open for businesses.  The stability created when supply is meeting the needs of a county’s citizens, provides security for consumers to purchase other products and services.



World Trade Organization. (2017a). What we do.  Retrieved from https://www.wto.org/english/thewto_e/whatis_e/what_we_do_e.htm

World Trade Organization. (2017b). Aid for Trade Fact Sheet.  Retrieved from https://www.wto.org/english/tratop_e/devel_e/a4t_e/a4t_factsheet_e.htm

World Trade Organization. (2017c). Aid for Trade.  Retrieved from https://www.wto.org/english/tratop_e/devel_e/a4t_e/aid4trade_e.htm

Discussion Response 2:


“The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations” (WTO, n.d.). The main purpose of the organization is to ensure that trade is open so that all countries and people can benefit. The WTO issues rules and regulations on a vast array of topics to try and ensure that none of its members are taken advantage of.

One of the areas in which it regulates is safeguards, specifically the emergency protection from imports. This means that WTO members are allowed to restrict or even stop the import of foreign products temporarily. This can be done if the product being sold locally – the domestic industry – is injured or threaten with injury if there was to be a sudden surge of imports. The agreement with the WTO also states that businesses can be granted safeguard from the government. However, when it is granted by the government rules must be followed such as, public hearings, and developing countries exporting goods are shielded from the safeguard actions

One of the important parts of the bill ensures that members are not allowed to keep safeguards going indefinitely. “The agreement says members must not seek, take or maintain any voluntary exports restraints, orderly marketing arrangements or any other similar measures on the export or import side”(WTO, n.d.). This type of safeguard agreement is used for many different products but in the United States is used primarily for automobiles, steel and semiconductors. For example, the European Union has restrictions on importing cars from Japan. Though this cannot continue indefinitely, it has put a temporary stop on the inhabits from buying Japanese style cars.


World Trade Organization. (.n.). Anit-dumping, subsidies, safeguards: contingencies, etc. Retrieved on September 13, 2017 from https://www.wto.org/english/thewto_e/whatis_e/tif_e/agrm8_e.htm#safeguards

World Trade Organization. (n.d.). What is the WTO? Retrieved on September 13, 2017 from https://www.wto.org/english/thewto_e/whatis_e/whatis_e.htm

Place Similar Order Now!

  • Our Support Staff are online 24/7
  • Our Writers are available 24/7
  • Most Urgent order is delivered with 6 Hrs
  • 100% Original Assignment Plagiarism report can be sent to you upon request.