Interpersonal Skills And Managerial Development Assignment Sample

Introduction Of Interpersonal Skills And Managerial Development

Description

The Tesco Accounting scandal, which emerged in 2014, involved a large overstatement of Tesco's financial commitments. Due to improper accounting procedures, it was found that the company overstated its income statement by $422 million, or £263 million. The incident destroyed the trust of the majority of employees and customers in a number of the largest supermarket chains in the UK.

The overall misrepresentation resulted from Tesco's reputation for using vendor financial status in a way that no longer followed accounting principles (ACCA, 2023). The company is accused of overbooked suppliers' funds, increasing its claimed profits.

While an independent auditor informed Tesco's management and outside auditing firms about inconsistencies within the competence of accounting, the controversy began to fade away. The examination revealed that the incorrect practices had been going on for a long time, leading to an accumulated overestimation of profits.

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The scandal had significant after-effects. Tesco's percentage rate fell, reducing its market price by billions of pounds. The company handled inquiries by regulatory authorities, including the Financial Conduct Authority (FCA) and the Serious Fraudulent Activity Office (SFO). Several managers, including the CEO and CFO at the time, walked away or were forced to leave the workforce.

The Tesco accounting scandal made clear how crucial accurate financial reporting in terms of transparent and moral behaviour is to successful business governance. It revealed shortcomings in Tesco's internal auditing processes and called into doubt the value of external audits (Mohapatra and MV, 2021). The incident sparked debate and accounting law and practice improvements throughout the UK, highlighting the need for more transparency and ethical behaviour within financial reporting.

The Tesco accounting scandal becomes an alarming example for companies and government agencies equally, highlighting the importance of maintaining moral accounting procedures, efficient internal control mechanisms, and a transparent and accountable way of existence. The incident left a lasting legacy in the shape of legislative changes and increased awareness of financial disclosure reliability.

Feelings

I had a variety of ideas and feelings when I researched the massive financial and accounting fraudulent scheme that was the Tesco accounting emergencies that surfaced around 2014. I immediately experienced a sense of shock and doubtfulness that such fraudulent activities had taken place within a renowned company like Tesco, which had gained considerable customer and investor trust. The discovery that a sizable agency, regarded as an integral component of the retail sector, manipulated its financial statements made me question the ethical foundation of not just Tesco but also the larger corporate globe.

I started to feel disappointed and frustrated as I learned more about the controversy. My confidence in the efficiency of the internal procedures and independent audits was shaken by the intentionally planned manipulation of financial information through Tesco. I wondered why these practices had been able to go unnoticed for years, underlining the constraints and potential weaknesses under the ongoing regulatory framework.

Furthermore, finding out about the participation of important administrators and their respective positions subsequent resignations or terminations sparked a mix of rage and dissatisfaction It highlighted questions about the moral character and accountability of organisations' topmost management, as the decisions they make will have a significant impact on the outcomes for staff members, stakeholders, and the wider economic framework.

The Tesco accounting disaster also made people experience bad for the innocent individuals who were harmed by the Enterprise's improper conduct of its business operations. Clients mistrust the trustworthiness and authenticity of the goods and services they had relied on, while suppliers, employees, and stakeholders experienced financial losses.

On the other hand, there had been a sparkle of hope mixed in with the negative emotions. The controversy brought to light the necessity of stronger laws, sophisticated corporate governance procedures, and enhanced financial accounting transparency (Millan and Serrat, 2023).

Evaluation

There were both positive and negative things to keep in mind when I read about the Tesco accounting controversy.

• Positive: Investigating the case revealed important details about the complexities and significant worldwide consequences of financial and accounting offences. It highlighted the necessity for continuous attention and inspection in business governance practices by exposing the weaknesses that may exist inside particularly well-mounted organisations (Akman, Acar and Kizil, 2020). I gained a stronger understanding of the relevance of timely financial disclosure, moral decision-making, and the role of regulatory organisations in upholding transparency and responsibility via studying the incident.

The Tesco accounting disaster has sparked conversations and improvements among regulatory organisations and the accounting profession. It led to a revision of auditing guidelines and standards, which enhanced knowledge of threat assessment and controlled assumptions. The affair made clear the necessity for improved internal controls, accountability policies, and protection for whistle-blowers to prevent future occurrences of this nature.

• Negative: The event also had some negative aspects. The extent of Tesco's manipulations and dishonesty was disappointing to learn about. The issue called into question the ability of regulatory organisations to recognise and prevent such fraud as well as the usefulness of external audits. It also emphasised their capacity to influence innocent individuals, including vendors, staff members, and shareholders. It is who experienced financial losses due to the absence of collaboration.

Another negative was the feeling of disappointment that resulted from learning that even organisations with a good reputation might engage in dishonest business practices (Millan and Serrat, 2023). This awareness has the potential to undermine company confidence as an individual and promote mistrust among customers and the general public.

Despite these limitations, learning about the Tesco accounting controversy proved to be an invaluable source of knowledge. It serves as an explanation of the significance of upholding the highest possible standards of honesty and responsibility when it comes to financial reporting, as well as the potential consequences that may arise when these requirements are violated.

Analysis

When the Tesco Accounting crisis is examined, it will become clear that the current state of affairs is a result of structural flaws, moral failings, and the importance of regulatory control within the financial and accounting professions.

According to Awolowo and Garrow, 2022, The scandal revealed structural flaws in Tesco's internal control procedures and auditing procedures. Ineffective accounting practices were allowed to continue for a long time, which shows that the agency no longer had enough oversight and accountability. This emphasises the necessity for organisations to regularly evaluate and enhance their internal security measures to stop the theft of funds and ensure timely financial disclosure.

Ethical failures were a major factor in the incident. Tesco's falsification of financial statements, particularly the overstatement of income, suggests that ethical standards have been neglected in favour of short-term profitability. The following prompts questions regarding the ethical environment within the organisation and the ethical standards of significant decision-makers. To mitigate the risk of unethical practices, it emphasises the importance of building an established culture of transparency and ethical conduct throughout an organisation.

The Tesco accounting crisis also highlights the crucial role that regulatory monitoring plays in preserving the accuracy of financial reporting. The issue prompted inquiries from regulatory organisations like the Financial Conduct Authority (FCA) and the Serious Fraud Office (SFO), emphasising the necessity of strong governing structures and enforcement systems. The Financial Reporting Council (FRC) also revised its auditing standards and recommendations as a result, highlighting the necessity of governing bodies in modifying laws to address new challenges and safeguard the interests of stakeholders.

This analysis shows that maintaining ethical practices and achieving honest financial reporting necessitates an integrated approach (Mohapatra and MV, 2021). Companies push themselves to establish and maintain strong internal controls, promote an ethical organisational culture, and encourage financial accounting integrity. Successful oversight procedures must be established by regulatory agencies, conformity must be enforced, and rules and regulations must be modified to address changing risks and challenging circumstances.

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Conclusion

In light of the examination of the Tesco accounting controversy, additional steps may have been done to further investigate and fully understand the situation.

First of all, doing a more in-depth examination of academic literature and taking into consideration accounting information might have given rise to a more comprehensive understanding of the controversy and its consequences. Further knowledge, such as common patterns, alert indicators, or preventive measures, should have been identified by reviewing a wider range of academic articles, research papers, and case studies of financial and accounting crises.

Finding first-hand information or conducting interviews with those who participated directly in the Tesco accounting scandal, such as those who disclose information, auditing firms, or regulating executives, may have provided insightful viewpoints and shed light on the internal structures and decision-making processes at the place of employment.

Additionally, investigating the scandal's long-term effects and consequences could have strengthened the evaluation. Investigating how the controversy affected Tesco's business practices, opposition from shareholders, modifications to auditing procedures, or governmental regulations in the months following the conclusion of the crisis would have given additional details about the long-term effects and insights gained.

Further, a wider understanding of Tesco's accounting trouble could have been possible by investigating comparative analyses of various accounting and financial scandals throughout the UK or around the world. The comparison and contrast of unique scandals may have revealed similarities, differences, or general problems that extend beyond particular occurrences.

Participating in conversations or arguments with colleagues or business experts who know about finance, accounting, or corporate governance, one may desire to have offered a variety of viewpoints and supplement the analysis with opposing points of view. By taking into consideration these recent developments, a more comprehensive and complex knowledge of Tesco's accounting challenges can be achieved. Could have been finished, helping to provide a far clearer assessment of the situation and its consequences for the accounting profession, and business ethics practices.

While studying in a degree pertaining to business management I have developed my research skills to the significant level. During the module, I have learnt how relevant articles can be assessed using keywords. Along with this, my analytical, writing and paraphrasing skills also have been improved. In the near future, with the help of this skill I would become able to accomplish further study and assignments prominently. To get higher grades in post-graduation I need to make focus on strengthening my analytical and time-management skills.

Continuous professional development plan

References

Books and Journals

• Akman, V., Acar, B. and Kizil, C., 2020. Audit Techniques to Avoid Cost Accounting Frauds. Emerging Markets Journal (EMAJ). University of Pittsburgh Press (USA). 10(1). pp.60-66.
• Awolowo, F. and Garrow, N., 2022. Why Audit Will Continue to Fail! Academia Letters. 5141.
• Millan, P.L. and Serrat, N.A., 2023. Relationship among economic crisis, stock market crashes and accounting scandals. Intangible Capital. 19(3). pp.359-378.
• Mohapatra, P. and MV, N.K., 2021. Accounting Scandal at Tesco. IUP Journal of Accounting Research & Audit Practices. 20(4).

Online

• ACCA, 2023. Tesco scandal – the perils of aggressive accounting. (Online). Available through: <https://www.accaglobal.com/gb/en/student/sa/features/tesco-scandal> Accessed on 30/06/2023.