Posted by Majd Abusadah.

Even though that companies usually have their own accountants who observe accounting transactions, there are still chances for fraud, and this can cause and increasing need for forensic accountants. As a result, universities started to provide courses in forensic accounting for people who are interested in a job as a forensic accountant, such as Florida National University (FNU).

While traditional accounting discusses the financial information and how to provide this information for different users, such as investors and mangers, forensic accounting is used to investigate and analyze financial information for determining if there are any illegal transactions that may have occurred. The forensic accountant’s role is to search and investigate an extensive domain of various crimes. For example, the crimes could involve company health care fraud, money laundering, and contract disagreements. Also, the forensic accountant might be required to be experts witnesses during a trial. Forensic accountants might use their skills in personal matters, such as: dissolution of a marriage where they have to study the financial positions for both parties and their spending for better settlement.

The discipline is starting to notice many needs that go beyond accounting and finances. According to FNU, “the need for skill sets more accustomed with the legal process and computer technology are highly sought after and play a crucial role in determining the outcome of courtroom events.” Forensic accounting affected by few factors such as appearing of a new generation of business professionals and hopeful entrepreneurs. There are around 500,000 new businesses each year and some of them use technology for their transactions. In fact, this extended the forensic accountant’s role to the digital world. Even though technology has a strong protection system, there is still a chance of risk, so it is important for forensic accountant to update their skills in this area.

Having traditional accountants is not enough for companies who want to protect their financial health. This is because their role does not include anything about how to investigate the financial information, hence, the need for forensic accountants.

Majd is a graduate accounting student with a concentration in forensic accounting at the Feliciano School of Business, Montclair State University.

Reference:

(2015, May 05). The Growing Importance of Forensic Accounting. Retrieved from http://www.fnu.edu/growing-importance-forensic-accounting/

Posted by Trisha Daraji.

After the recent recalls in Ford pick-ups for braking issues in May, Ford Motors is back in the limelight for similar issues. In the previous recalls, the malfunctions in the vehicles occurred from an internal leak that caused the cars to lose braking function and have a loss of brake pressure. Last May, there were 225,000 models affected with the problem which all had the 2.5 EcoBoost engine (Valdes- Dapena, CNN Money). The cars involved in the new recalls are the same models that have the same engine, and have the similar problem of break failures.  Ford Motor Vehicles is now under investigation for the break failures reported by 25 owners. The malfunctions that occurred in May involved Ford’s 2013 and 2014 F-150 pick-up truck models, and similar malfunctions were reported in the 2015 and 2016 models. Not only are the models some of Fords most popular vehicles, but they are also the top selling vehicles in the U.S. The federal auto safety regulations agency has launched the investigation, and the National Highway Traffic Safety Administration is now considering expanding the recall launched in May to include the new model years.

Aside from the emerging braking problems in Ford’s most popular and best-selling vehicles, the company is under another investigation for safety issues concerning door-latch warning signs and steering issues. “The U.S. National Highway Traffic Safety Administration said today it was opening a probe into 380,000 2011-2013 Ford Edge SUVs after receiving 1,560 reports of ‘door ajar’ lights” (Shepardson, Automotive News). Owners reported that doors would not properly close and would swing open while the vehicle is moving. One injury has been reported, but there have been no reports of crashes. The recall for door latches has been expanded from 1.5 million vehicles to 2.4 million. A separate investigation was opened for the steering problems found in 262,000 2010 Ford Fusion cars. The failures in the system caused 12 crashes and four injuries (Shepardson, Automatic News).

From the recent recalls, it is estimated that 642,000 cars could be affected. Not only has this become a growing safety issue for Ford car owners, but it has also taken a huge toll on the company’s profit and reputation. The door-latch issues have resulted in six different recalls of 4 million cars since the year 2014. The new recall has been expanded and include Ford C-Max & Ford Escape (2013-2015), Ford Focus (2012-2015), Ford Mustang & Lincoln MKC (2015), and Ford Transit Connect vans (2014-16). The recalls have cost the company to cut its pre-tax profit from $10.8 billion to $10.2 billion due to the $640 million charges from recalls (Shepardson, Automatic News).

Trisha is an accounting student at the Feliciano School of Business, Montclair State University, Class of 2019.
Works Cited:

http://www.autonews.com/article/20161003/OEM11/161009993/ford-vehicles-being-probed-by-u.s.-over-door-latch-lights-steering

http://money.cnn.com/2016/10/04/autos/ford-f-150-brake-investigation/

Posted by Mariafernanda Ayin.

Best Buy is considered one of the biggest electronic selling corporations, but not even the biggest companies can avoid problems. Best Buy has been selling products like TVs, computers, and appliances such as washing machines that have had recalls.  These recalls have been one of the biggest headlines in the past couple of months in the electronics industry.

Federal Law states that it is illegal to sell and distribute products to consumers that have been publicly recalled. Best Buy, allegedly knowing that they were selling recalled products, told the U.S. Consumer Product Safety Commission that they had created measures to stop the risk of selling recalled products, however they continue to do so. Therefore, U.S. Consumer Product Safety Commission decided to penalize Best Buy because the company was not able to effectively create procedures to be able to identify, separate, and avoid selling recall products. In addition, Best Buy failed to block the product code which caused them to get erroneous information that indicated that the recall product was not in inventory.

Best Buy is being blamed for selling over 16 different products and a total of 600 recall items from September 2010 through October 2015—400 of the items being Canon cameras. Some of the items sold had a risk of skin irritation, and even catching on fire, which could have caused enormous harm to the customers. Best Buy is a company that has shown a clear lack of ethics by knowingly selling and distributing recall products just to make a profit, not caring about the well-being of their customers. This unethical act caused Best Buy to settle and pay $3.8 million of civil penalty in thirty days and in addition the company needed to create a compliance program to show that they are strictly following the laws and regulations of the Consumer Product Safety Act.

After the settlement was made, Best Buy sent a spokesperson to publicly address the situation, making an announcement after the settlement, “we regret that any products within the scope of a recall were not removed entirely from our shelves and online channels. While the number of items accidentally sold was small, even one was too many. We have taken steps, in cooperation with the CPSC, to help prevent these issues from recurring.” (Kieler).

This whole dilemma that Best Buy has been through has put them in the eye of the public, and could of possibly affected their sales. However, they still remain one of the biggest companies in the electronic business, and most likely will surpass this situation.

Mariafernanda is an accounting major at the Feliciano School of Business, Montclair State University, Class of 2019.

Posted by Krista Cerpina.

Last week the Department of Homeland Security placed a ban on large electronics during non-stop flights to the US from airports in North Africa and Middle East. The ban forbids passengers to carry on board any electronic devices larger than a cell phone. Many passengers traveling for business are almost “inseparable” from their laptops because many prefer to use travel time for work, so the new ban has been a headache not only for the airlines but also for their customers. Corporate business travelers are the most important block of costumers to the affected airlines, therefore airlines are cleverly defying the ban to keep their customers satisfied.

The travel industries well known airlines such as Emirates, Qatar Airways, Etihad, and Turkish Airlines have all been coming up with creative ways to counter the ban. To minimize the time passengers have to spend apart from their electronic devices, Emirates announces a service on March 23, that will allow the passengers to not check their devices in their luggage, rather the staff members will collect them at the gate. The laptops and other electronic devices will then be packed in secure boxes before storing them in cargo hold. Emirates Airline President Sir Tim Clark spoke to Business Insider and addressed the new operations regarding the ban. “Our aim is to ensure compliance with the new rules, while minimizing disruption to passenger flow and impact on customer experience,” Clark said in a statement. “Our new complimentary service enables passengers, particularly those flying for business, to have the flexibility to use their devices until the last possible moment.”

Other airlines such as Etihad Airways have also been trying to find ways to compromise with their costumers while not disobeying the new ban. “To help guests keep in touch with work, friends and family, we are offering First & Business Class guests free WiFi and iPads on all our US-bound flights, beginning Sunday, April 2,” Etihad said. The airlines and their passengers are still adjusting to the new ban, but according to Tim Clark, the airlines do not have any conclusive data on the long-term effect the laptop ban will have on their business and they do not expect to see any changes until May.

Krista is a business major at the Stillman School of Business, Seton Hall University, Class of 2020.

Posted by Randy Gomez.

In Business Law class, I learned about business ethics and how an entity should behave as a good citizen. In this article that I found online, it explains how the Federal Communications Commission fined AT&T 100 million dollars for slowing down data speeds to some customers. According to the FCC, AT&T violated a transparency rule by misleading customers saying that their plans were unlimited, when there was a maximum speed that customers would receive. AT&T is accused of not sufficiently informing its subscribers. The FCC chairman Tom Wheeler said “consumers deserve to get what they paid for,” and that, “[b]roadband providers must be upfront and transparent about the services they provide.”

It seems that the corporation was trying to maximize their short-term profits, by not being clear enough about the services provided to the consumer. As it usually happens when a corporation acts unethically to increase their profits, AT&T hurt their profits and now is receiving bad publicity. This is a great example of why companies have to take in consideration moral and ethical principles toward their decisions, instead of just trying to maximize profits.

Randy is a business administration major with a concentration in finance at Montclair State University, Class of 2017.

Posted by Griffin Mehl.

Up until recently the idea of a self-driving car has simply been a dream. The whole concept surrounding the thought that a car could be capable of operating on its own was just too much for people to handle. However, over the past several years this notion has changed. People and companies have begun to invest a significant amount of time and money into the exploration and discovery of this technology. As can be imagined, this idea has become less futuristic and more realistic a rivalry has begun to develop between companies trying to create these cars. As can be inferred from the article, two of the big names that have made a statement in this field are both Alphabet (“an American multinational conglomerate founded on October 2, 2015 by the two founders of Google”-Wikipedia) and Uber (“ transportation network company headquartered in San Francisco” –Wikipedia). In fact these companies are currently involved in a lawsuit. A vital person involved in this whole ordeal is “Anthony Levandowski, an engineer who left Waymo and launched self-driving truck company Otto.” For those of you who don’t know Waymo is simply “Google’s self-driving car company.”

As can be gathered from the article, there is currently an issue that has risen between Uber and Alphabet. More specifically Waymo is the one who “brought a lawsuit against the embattled ride-hailing service, alleging that Uber stole the proprietary design of a system built in its vehicles.” This all stems back to Mr. Lavandowski the engineer who used to work at Waymo. While he was under employment there, he decided to download a trove of data and self-driving technology onto his personal computer. This was done that way he could work from anywhere and wouldn’t have to be in the office to access this vital information/technology/drawings/specs for self-driving cars. After working with Waymo for a stint of time Lavandowski decided to split and create his own company “Otto” as I mentioned before. After this divide “Waymo alleged that Levandowski used that information to build his company.” All this would have been missed had it not been for a simple erroneous email that a Waymo employee received. In that email a Vendor thought he was reaching out to Uber, but instead he was mistakenly reaching out to Waymo. The email contained “specs for Otto’s circuit board technology — a central system for the self-driving vehicles — that Waymo alleges looks very similar to the tech it’s developing”. Basically, what Waymo was able to realize was that “Otto” (and the man behind it) which is now under contract by Uber had been using information and technology that was initially created by Waymo.

So, what can be taken away from this? First, if you or even the company you are a part of is working with patented information and critical data (like Waymo was) it is important to make the procedures for sharing that information known. It is very hard to blame someone for violating a procedure if they are not well informed about the rules in the first place. Second, if you or the company you are a part of deal with sensitive materials there are many preventive steps that can be taken in order to avoid that information from getting into others hands. An example of this would be a nondisclosure agreement. By signing one of these, it makes it clear that people who are in contact with classified information know they cannot share that information with anyone else. Finally, the most basic point is to make sure you are sending your messages/emails to the right people. I can’t tell you how many times I have mistakenly sent an email to the wrong person. If there is some classified information in your email that you wouldn’t want anyone but your intended audience to see it wouldn’t hurt to check who it’s going to twice.

Sources:

“Alphabet Inc.” Wikipedia. Wikimedia Foundation, 27 Mar. 2017. Web. 31 Mar. 2017.

“Uber (company).” Wikipedia. Wikimedia Foundation, 29 Mar. 2017. Web. 31 Mar. 2017.

https://www.entrepreneur.com/article/290792

Griffin is a finance major with a minor in accounting and certificate in entrepreneurial studies at the Stillman School of Business, Seton Hall University, Class of 2019.

Posted by Danielle Lindsay Feoranzo.

It was on June 4^th 2015 that the U.S Supreme Court found the State of Maryland’s system of personal income taxation violated the nondiscrimination prong of the Dormant Commerce Clause. This clause states Congress has been given power over interstate commerce, and that states cannot discriminate against interstate commerce, nor can they unduly burden interstate commerce, even in the absence of federal legislation regulating the activity. The Court found that Maryland did not grant a resident credit for county income tax paid on income earned and taxed in another state. What to keep in mind is this particular state’s personal income tax scheme is of composed of three elements:

(1) A state tax imposed on all income of Maryland residents and the income of nonresidents from sources within Maryland, (2) a county tax (collected by the state) imposed on all income of state residents, and (3) a special nonresident state tax imposed on the income of nonresidents from sources within Maryland, which tax is said to be in lieu of the county tax and is imposed at a rate equal to the highest county tax within the state (pg. 1; Bright, Schulder, Upham).

In this instance, the Wynnes were state residents and subject to tax in 39 other states because they owned a corporation that resides in multiple states. The Wynnes were able to take a tax credit in Maryland against taxes paid to other states on their corporation income but were not allowed to take a credit against Maryland county tax for taxes paid to other states on the corporation income. The Court held that:

Maryland’s personal income tax system was not internally consistent under the Commerce Clause and therefore unconstitutionally discriminatory. According to the Court, if every state imposed their personal income tax in the same way as Maryland, an individual who lived in one state and worked in another would always be subject to a higher tax burden than an individual who lived and worked in the same state. The taxing scheme gave preferential treatment to purely intrastate activities versus interstate activities.

Therefore, the Court concluded that Maryland’s personal income tax system was not consistent under the Dormant Commerce Clause, and thus, unconstitutional.

In conclusion, the Wynnes were within their constitutional right to get a tax credit not only on their state tax but also on their county tax. This because it was protected under the Dormant Commerce Clause not to discriminate wherever that income is earned.

Danielle is a business administration major with a concentration in management information and technology at Montclair State University, Class of 2016.

Posted by Griffin Mehl.

Up until recently the idea of a self-driving car has simply been a dream. The whole concept surrounding the thought that a car could be capable of operating on its own was just too much for people to handle. However, over the past several years this notion has changed. People and companies have begun to invest a significant amount of time and money into the exploration and discovery of this technology. As can be imagined, this idea has become less futuristic and more realistic a rivalry has begun to develop between companies trying to create these cars. As can be inferred from the article, two of the big names that have made a statement in this field are both Alphabet (“an American multinational conglomerate founded on October 2, 2015 by the two founders of Google”-Wikipedia) and Uber (“ transportation network company headquartered in San Francisco” –Wikipedia). In fact these companies are currently involved in a lawsuit. A vital person involved in this whole ordeal is “Anthony Levandowski, an engineer who left Waymo and launched self-driving truck company Otto.” For those of you who don’t know Waymo is simply “Google’s self-driving car company.”

As can be gathered from the article, there is currently an issue that has risen between Uber and Alphabet. More specifically Waymo is the one who “brought a lawsuit against the embattled ride-hailing service, alleging that Uber stole the proprietary design of a system built in its vehicles.” This all stems back to Mr. Lavandowski the engineer who used to work at Waymo. While he was under employment there, he decided to download a trove of data and self-driving technology onto his personal computer. This was done that way he could work from anywhere and wouldn’t have to be in the office to access this vital information/technology/drawings/specs for self-driving cars. After working with Waymo for a stint of time Lavandowski decided to split and create his own company “Otto” as I mentioned before. After this divide “Waymo alleged that Levandowski used that information to build his company.” All this would have been missed had it not been for a simple erroneous email that a Waymo employee received. In that email a Vendor thought he was reaching out to Uber, but instead he was mistakenly reaching out to Waymo. The email contained “specs for Otto’s circuit board technology — a central system for the self-driving vehicles — that Waymo alleges looks very similar to the tech it’s developing”. Basically, what Waymo was able to realize was that “Otto” (and the man behind it) which is now under contract by Uber had been using information and technology that was initially created by Waymo.

So, what can be taken away from this? First, if you or even the company you are a part of is working with patented information and critical data (like Waymo was) it is important to make the procedures for sharing that information known. It is very hard to blame someone for violating a procedure if they are not well informed about the rules in the first place. Second, if you or the company you are a part of deal with sensitive materials there are many preventive steps that can be taken in order to avoid that information from getting into others hands. An example of this would be a nondisclosure agreement. By signing one of these, it makes it clear that people who are in contact with classified information know they cannot share that information with anyone else. Finally, the most basic point is to make sure you are sending your messages/emails to the right people. I can’t tell you how many times I have mistakenly sent an email to the wrong person. If there is some classified information in your email that you wouldn’t want anyone but your intended audience to see it wouldn’t hurt to check who it’s going to twice.

Sources:

“Alphabet Inc.” Wikipedia. Wikimedia Foundation, 27 Mar. 2017. Web. 31 Mar. 2017.

“Uber (company).” Wikipedia. Wikimedia Foundation, 29 Mar. 2017. Web. 31 Mar. 2017.

https://www.entrepreneur.com/article/290792

Griffin is a finance major with a minor in accounting and certificate in entrepreneurial studies at the Stillman School of Business, Seton Hall University, Class of 2019.

Posted by Arleen Frias-Arias.

According to NPR News.com, Ocwen Mortgage, who has been tasked by FDIC (Federal Depose Insurance Corporation) and US Department of Treasury to assist consumers that are delinquent in their mortgages, is being sued. New York State’s top financial regulator has launched an investigation into Ocwen’s practices as it turns out they are finically hurting home-owners, not helping them get out of foreclosure.

The gist of the article is that Ocwen committed fraud by preparing mortgage documents particularly on what is called a loan modification, which is a legal contract prepared to adjust the payments of loan borrowers who could not make their payments due to hardship. They are also accused of not posting payments already in their possession from borrowers until past the payment due date, deliberately causing homeowners to become late and incur fees.

In my opinion, more needs to be substantiated by regulators to determine if this was widespread, because Ocwen seems to have a reputation of consistently not adhering to the law.

Arleen is a marketing and communication/TV production major at Montclair State University, Class of 2018.

Posted by Danielle Lindsay Feoranzo.

It was on June 4^th 2015 that the U.S Supreme Court found the State of Maryland’s system of personal income taxation violated the nondiscrimination prong of the Dormant Commerce Clause. This clause states Congress has been given power over interstate commerce, and that states cannot discriminate against interstate commerce, nor can they unduly burden interstate commerce, even in the absence of federal legislation regulating the activity. The Court found that Maryland did not grant a resident credit for county income tax paid on income earned and taxed in another state. What to keep in mind is this particular state’s personal income tax scheme is of composed of three elements:

(1) A state tax imposed on all income of Maryland residents and the income of nonresidents from sources within Maryland, (2) a county tax (collected by the state) imposed on all income of state residents, and (3) a special nonresident state tax imposed on the income of nonresidents from sources within Maryland, which tax is said to be in lieu of the county tax and is imposed at a rate equal to the highest county tax within the state (pg. 1; Bright, Schulder, Upham).

In this instance, the Wynnes were state residents and subject to tax in 39 other states because they owned a corporation that resides in multiple states. The Wynnes were able to take a tax credit in Maryland against taxes paid to other states on their corporation income but were not allowed to take a credit against Maryland county tax for taxes paid to other states on the corporation income. The Court held that:

Maryland’s personal income tax system was not internally consistent under the Commerce Clause and therefore unconstitutionally discriminatory. According to the Court, if every state imposed their personal income tax in the same way as Maryland, an individual who lived in one state and worked in another would always be subject to a higher tax burden than an individual who lived and worked in the same state. The taxing scheme gave preferential treatment to purely intrastate activities versus interstate activities.

Therefore, the Court concluded that Maryland’s personal income tax system was not consistent under the Dormant Commerce Clause, and thus, unconstitutional.

In conclusion, the Wynnes were within their constitutional right to get a tax credit not only on their state tax but also on their county tax. This because it was protected under the Dormant Commerce Clause not to discriminate wherever that income is earned.

Danielle is a business administration major with a concentration in management information and technology at Montclair State University, Class of 2016.