Purpose of the Audit
Discuss about the Marketisation of Childhood Education and Care.
ABC learning center was known for its pioneering services provided in the field of the various type of the services relating to early childhood education. It was seen to be listed in the ASX with a total market capitalization reaching as high as AUD $2.5 billion in March 2006. It has been further identified that the company has faced several types of the issues, which was seen terms of the fallout from the subprime mortgage crisis, which further led to several types of the causes for debt repayments to overwhelm the company. In addition to this, the auditors failed to sign off on the financial reports citing the need to recast previous year’s reported profits. The company went to voluntary liquidation in 2008 and was taken over by Goodstart Limited in December 2009 (Howard, 2015).
The purpose of the report is to discuss on the significance in the audit of the ABC learning center. The report has been further seen to cover the relevant aspects of the research to provide the evaluation of the collapse of ABC Learning about ‘common good’, ‘stewardship’, and ‘corporate social responsibility’. It has been further able to take into considerations the aspects of the study, which is observed to be related to the Identification of the ethical issues, which contributed to the downfall of ABC Learning by stating the underlying ethical theory. The later part of the report has been further able to provide the relevant evaluation, which has been seen to be associated to the unethical practice, which has negatively affected the stakeholders (Hessian, 2014).
The purpose of the audit was done to identify the various types of the misstatement that were observed in the annual report, published by ABC learning center in 2006. It was observed that the company went through administrative receivership after because of fallout from the subprime mortgage crisis. This led to several types of the debt repayments to be overwhelmed by the company. It has been further observed the main purpose of the auditors was to sign off the various types of the financial citing, which were seen to be re-casted by the company. The auditors needed to take into account the incidences associated to such misstatements and ensure that, these issues has been taken into account during the preparation of the financial report. The auditors failed to do so (Nyland & Ng, 2016).
Identification of Ethical Issues and Discussion with Respect to Relevant Ethical Theories
In addition to this, Ernst & Young took a differenced approach from the Pitcher Partners, who were seen to agree on the initial interpretations sent by the company’s management team. The company was seen to earn a significant amount of the profit based on the auditors failed to identify the inherent risk, which were seen to be associated with the valuation of the assets (Logan et al., 2015).
The main of the failure of the company was mainly seen due to various types of the drawbacks identified in form of the different types of the government policy failures apart from the general failures in the business. The complete cases associated to the collapse of the company have been identified in form of the various types of the considerations made in the last three years prior to its failure (Newberry & Brennan, 2013). Australia is seen to move into communality-dominated childcare service in the last three years from a private-dominated model. However, there was no fault in the former model and it was acclaimed as a sound model to address the various types of the early childcare services (Callcut et al., 2016).
The collapse of ABC Learning with respect to corporate social responsibility, common good and stewardship was identified when the government subsidies grew and ABC Learning began emphasizing on the acquisition of childcare centers instead of running for the facilitation of the childcare center as a Government entity. It has been further observed that the various types of the consideration which has been seen to be made in the various type the assessment has been discerned in form of the various consideration which has been identified in form of the Howard Government’s strong encouragement of private sector child care provision. In some of the other types of the reports, it has been identified that the company was identified as a victim of the corporate governance by seizure of the various types of the opportunity and ambitious expansion. This was seen to be evident in form of the acquiring properties in prime locations and buying out single daycare centers and smaller childcare groups. In several types of the other cases it has been further seen that the various form of the other aspect of ABC Learning n center has been discerned in form of the different aspects of the studies related to the “unqualified” audit opinions by the major accounting firms. The aftermath associated to this resulted into various types of the associated major issues for the company (Brennan, 2014).
Effect of Unethical Practices on Stakeholders and Evaluation of the Auditor’s Role
The various types of the identification of the ethical issues of the company has been identified in form of the various types of the aspects associated to the nightmare caused to the majority of the parents in the Australia. It has been further been able to identify that the various types of the other issues identified as the collapse of the ABC Learning Center has been able to be discerned in form of the different types of the issues raised due to the loss caused to the ingoing students. It has been further been able to be identified that the various types of the issues identified in this regard has been able to emphasize ion the majority of the areas which has been able to be seen in terms of the jeopardizing the career of the ongoing child care in the development center. Some of the different types of the other consideration made in ethical issues have been identified in terms of the accountants of the ABC learning center. The collapse of the organization was further seen in terms of the various associated issue, which were seen to be causing several types of the harming data reporting (Brown & Davis, 2015). The accountants of the company are also seen to be violating the code of eh ethical conduct in various aspect (Klein & Li, 2016). It has been further been able to be discerned that the important consideration seen on terms of the failure to comply with the corporate governance practices has been able, to relate the various types of the concerns which are seen to be related to hamper the position of the company in major ways (Miller & Orchard, 2014).
It has been see that the various types of the issue associated to the technical training of the accountants has been seen to be the major cause of the wrong casting of the report. The main form of the issue associated to the ethical theories has been discerned in form of breach of Normative Principles in Applied Ethics and the various types of the associated issue in terms of applied ethics theory.
The stakeholder analysis of the failure of the ABC Company has been identified in from of the various types of the associations made in the study related to the various types of the loss of credibility as an aftermath of the aforementioned incident. Some of the other types of the downfall in this aspect were seen to be further related to falling of the stock price from $ 8.62 to $ 0.54. Because of this the company got delisted from the ASX and went into being recognized for receivership (Gallagher, 2017).
Conclusion
In addition to this, the auditor’s role was seen in terms of the issue, which was seen to be raised due to the failure to identify the issues for signing off on the financial reports citing the need to recast previous year’s reported profits. This led ABC Learning Company for voluntary liquidation in 2008 and was taken over by Goodstart Limited in December 2009 (George, 2015).
Conclusion
Some of the main findings based on the report have been seen in terms of the importance of the recognition of the revenue in proper manner. The companies are further seen to put emphasis on the various types of the considerations, which are seen to be made in the relevant aspects of the business in terms of the putting central importance on the financial accounts and indicating accurate findings on the heath of the company. Some of the important findings based on the report has been able to state on the relevant issues which are seen to be related to the different types of the considerations in terms of adherence to a sound corporate governance policy. The study has been further able to evaluate the different types of the issue which are associated to the breach in the code of the ethics and the various type of the flaws in maintaining the CSR aspect of the company.
Reference List
Brennan, D. (2014). The business of care: Australia’s experiment with the marketisation of childcare. Australian Public Policy: Progressive Ideas in the Neoliberal Ascendency, 151-167.
Brown, C. A., & Davis, K. T. (2015). The sub-prime crisis down under.
Callcut, R. A., Cripps, M. W., Nelson, M. F., Conroy, A. S., Robinson, B. B., & Cohen, M. J. (2016). The massive transfusion score as a decision aid for resuscitation: learning when to turn the massive transfusion protocol on and off. Journal of trauma and acute care surgery, 80(3), 450-456.
Gallagher, A. (2017). Growing pains? Change in the New Zealand childcare market 2006–2016. New Zealand Geographer.
George, T. P. (2015). Making an impact with service learning. Nursing2016, 45(12), 21-24.
Hessian, K. (2014). Rise of the new corporates. Rattler (Sydney), (110), 10.
Howard, C. (2015). Happy birthday kindergarten. Rattler (Sydney), (114), 6.
Klein, M. D., & Li, S. T. T. (2016). Building on the Shoulders of Giants: A Model for Developing Medical Education Scholarship Using I-PASS. Academic pediatrics, 16(6), 499-500.
Logan, H., Sumsion, J., & Press, F. (2015). The Council of Australian Government Reforms [2007–2013]: a critical juncture in Australian early childhood education and care (ECEC) policy?. International Journal of Child Care and Education Policy, 9(1), 1-16.
Miller, C., & Orchard, L. (2014). On escaping neoliberalism: concluding reflections. Australian public policy: Progressive ideas in the neoliberal ascendency, 351.
Newberry, S., & Brennan, D. (2013). The marketisation of early childhood education and care (ECEC) in Australia: A structured response. Financial Accountability & Management, 29(3), 227-245.
Nyland, B., & Ng, J. (2016). International perspectives on early childhood curriculum changes in Singapore and Australia. European Early Childhood Education Research Journal, 24(3), 465-476.
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