Emile Durkheim Essay

Emile Durkheim was a French sociologist who is considered to be the founding father of sociology. His contributions were in sociology, Anthropology and religions studies. He published and lectured sociological studies in topics like education, crime, religion, suicide and division of labor. Durkheim was born in Pascoag province of Lorraine, formerly in Germany but presently in France, in 1859, April 15. His family line was of rabbi but he rebelled against this title while still a kid. Much of his work was to show that religions bases were from social issues and not a divine issue. Though he rebelled against his family rabbi tradition, his relationship to the family and the Jewish community was still intact. Most of his collaborators and students were drawn from the Jewish community and was even confirmed under the Jewish traditions at the age of thirteen. He followed the regular system in the secular school and at the same time studied Hebrew, Talmud and Old Testament. He at one time acquired some numinous skills in Catholicism from his female teacher who was a catholic herself. However, soon after, he developed some doubts in religion and withdrew his involvement in it. In the college d’Epinal, he was a precocious scholar and this earned him some prizes and honors. This motivated him towards his ambition and transferred to Lycee Louis-le-Grand, a French high school in Paris. Later in 1879, he joined Ecole Normale Superieure a training institution for French scholars. In the ground, he met some major scholars marking French intellectual life. These were; Henri Bergsona a vitalism philosopher, Jean Jaures a social leader, Rauh, Golot and Blondel all philophers and Peirre Janet a psychologist. His interest is a scientific view to society earned him some opposition towards Ecole Normale academic system. It contained no social science which was Durkheim interest. Instead, humanistic studies dominated the academic system. He rebelled against a course that privileged reading of Latin prose and Greek verse and felt recent scientific discoveries and philosophical doctrines should have been the privileged. He was for a solid and structured learning rather than elegant dabbling system which was even rewarded. In 1882 he finished 2nd last in his graduation class. Despite his rebel nature, he had some good friends like Jean Jaures – a socialist leader. He was known to be intelligent, dedicated, a good moral and scientific instructor. (Caser 143) After spending a year in Germany studying sociology, he returned to Bordeaux where a teacher’s training school had just been started. There, he taught social sciences and pedagogy. He was credited for introducing social sciences in the French curriculum. However, his argument that social science could easily explain morality and religion was criticized. Thereafter in 1890s, it became Durkheim’s period of his significant contribution. In 1893, he published his doctoral dissertation â€Å"The Division of labor in Society†, which was a study of how social order was maintained in differing societies. 1895 published â€Å"Rules of the sociological method† manifesting on sociology definition and how it is supposed to be done. One the same year, 1895, he founded Department of Sociology at the University of Bordeaux. In 1898 he published his increasing students and collaborators works in â€Å"LAnnes Sociologuque† a journal he had founded. In 1897, he published â€Å"Suicide† a study providing examples of what the sociological monograph might look. He used quantitative methods in criminology to explore the different crime rates among Protestants and Catholics. He found the strong social control among catholic reduced suicide rates. In 1902, Durkheim was the permanent chair of education and sociology. In the same year 1912, he published his major work â€Å"The elementary forms of Religious life† During the world war which was characterized by propaganda, Durkheim dropped his position on politics which was patriotic rather than internationalism. His former students had died in the war including his own son. This caused Durkheim mental blows. He had lost his son and his rational secular life had been affected by the war. In 1917, he suffered a stroke from emotional strains and exhaustion, recovered months later and resumed to work but later on the same year died. Emile Durkheim was laid to rest in Paris. (Emile Durkheim) His theories and ideas mainly focused social structural assertions of human social tribulations. He covered the social facts, division of labor, education, crime, punishment law and suicide. In social facts, Durkheim felt that the society is much more than what it meant. He incorporated issue like ethnic and religion background. His priority was not on what influences individuals behaviors or acts but in social facts. His argument about social facts is that its existence is more objective and greater than individual’s actions and who makes a society. He argued that only if people in a society were oriented to a common symbolic representation sets, to a common assumption about the environment, could moral unity prevail. Without them any society irrespective of its modernity or primitive nature would degenerate and decay. (Coser 144) In religion, his views are that it is a pervasive aspect in social structure. It is more human oriented aimed at uniting communities. He looks at it effect on an individual and the way they behave, how it can divide a community and its role in the society. Durkheim defines religion as a cultural system of commonly shared beliefs and rituals that provides a sense of ultimate meaning and purpose by creating an idea of reality based on super natural powers (Giddens 534) In division of labor, he argues that despite it aim for material and intellectual development in the society; it has a moral factor more important in that it enhances social unity among people. He argues that people have something in common. This is what binds them together along traditional lines for they are more or less the same. The highly complex division of labor in modern communities was influenced by ‘organic’ solidarity. Specialization and social roles tie individuals to one another. He argues law is a major symbol in the social unity. Punishments acts in it are meant to sustain the unity. Law is not meant to punish but restrain the existing unity. Durkheim called the breaking of social norms state of anomic. (Calhoun 47) He tried to argue suicide by comparing its rates among the Protestants and Catholics. There was less suicide cases in catholic than in protestant. According to him this was as a result of catholic strict norms. His work has influence control theory of sociology. His view on punishment is that it is important in the society setting. He argues social solidarity can only be maintained through punishment. To avoid law breakers who in turn threaten the social unity in a society, punishments act as a threat. However, he calls for a relevant punishment amount claiming it threatens immorality. On crime, he feels it is useful as it leads to reform. It is a response to a pressing social tension and therefore flushes out the pressing issue off the society. (Parsons 32) As a teacher, he had interest in education. He felt it is an important entity in the social structure as it strengthens social cohesion, maintains social roles and maintains division of labor. Emile Durkheim has over the years influenced sociology scholar. In most cases, they have based their studies in his arguments. In most education curriculum, his sociology initiative has been incorporated. His arguments in almost all the areas in social structure have influenced the modern society. Major education institutes offers courses on sociology all over the world. The study of criminology has based its findings in Emile’s ideas. His sociological theories and ideas have been used to explain the causes of crimes in a society. Policy and law makers have used Durkheim’s ideas in making the law. Courts too in their making of judgments they have based it on his ideas. For example cases of suicide and crimes. His findings have been very significant in trying to understand terrorism and terrorism acts. In the modern society, this has been a major threat to the international unity. Religion has been known to be the root cause of such terrorism acts. The 9/11 us terrorism act was by Islamic extremists. The social control in Islamic does not restrict this and therefore it may not look more of a crime to them. Religion has influenced the society greatly, from politics, rituals and practices. On the religion set social norms, members have behaved and acted according to them. Civil wars in most of the word nations are as a result of social norms conflict among different societies. Most of the crimes against humanities have been important in that it has influenced reforms as per Durkheim ideas. Many societies have learnt from past experiences and have significantly reformed to be stronger and united. However, some societies have released social tensions through criminal activities like wars and the end result have been improved unity. This justifies Durkheim’s idea on crime that it is important in reformation. The United Nation body is significant in the world’s unity. The social norms outlined in its organization have a great influence in controlling the world’s societies in their actions. Exploitation is now reduced and independence has prevailed. On the other hand, the larger community i. e. the world is now much more united. Division of labor which is an evident entity in the modern society is more than just sharing responsibilities and roles. It is very significant in social unity. The coming together of specialists from different background has enhanced interaction and understanding among a larger population. In the labor firms, acts that govern a company have been made by their respective policy makers and are significant in the social unity and in role sharing. Durkeim’s scientific views on the society, his contributions and influences are very visible in the modern society.Therefore, he deserves acknowledgment as the founding father of sociology. Work cited: Coser, . Emile Durkheim the Person: sociology at hewett 1977. Retrieved on Friday, October 17, 2008 from http://www. hewett. norfolk. sch. uk/curric/soc/durkheim/durkper. htm Emile Durkheim Site: Emile Durkheim biography: mosaic Retrieved on Friday, October 17, 2008 from http://www. emiledurkheim. net/ Giddens, A& Griffiths, S . Religion in the modern society: Polity, 2006. 138- 148 Parsons, T. et al . Theories of Society, New York: Free Press, 2006, 33-48 Calhoun, et al: Classical Sociological Theory . Blackwell Publishing, 2007. 45-66

Alternative to Economic Globalization

The book â€Å"Alternatives to Economic Globalization: A Better World is Possible – A Report of The International Forum on Globalization† by Cavanagh and Mander is innovative and controversial book revealing misconceptions of Friedman’s â€Å"The World is Flat† and describing multinational imperialism as inevitable consequence of cultural and carnage obliteration.Firstly, it may seem that the authors are likely to advocate for globalization, in particular, for neoliberalism – corporate globalization – stating that globalization can de defined as inevitable result of technological forces and evolutionary process.In other words, no matter how the world is developing, it will inevitably result in globalization process. Therefore, the book is successful attempt to make corporate globalization more natural and effective. The authors define corporate globalization as privatization of goods and services and as the cult of international capitalism. C avanagh and Mander discuss pros and cons of globalization, implications and fallouts of globalized economies. However, with book progression it becomes apparent that the authors stand against globalization.(Brown & Renner 2006) The authors start from describing the consequences of World Trade Organization protest taken place in Seattle in 1999 and they try to find answer whether it is possible to exist without globalization and what community would think of you if you were against globalization. Answering these questions, the author offer four-hundred pages direction how to make our world better and how to move toward more sustainable democratic world. The authors provide key components of globalization model:†¢ Hypergrowth resulting in inevitable search for new alternative resources, cheaper labour force and new unexplored markets; †¢ Commoditisation and privatization of medicines; access to freshwater; intellectual property rights; radio waves; fertilizers and seeds; â⠂¬ ¢ Economic and cultural homogenization meaning that there is a need to create such global culture where â€Å"every place is becoming more and more like every other place†; (Cavanagh & Mander, 38) †¢ Export-oriented investment and trade applying the merits of comparative advantage.It is known that the book is a result of discussions taken place during the period 1999-2002 by the International Forum on Globalization. The forum involved many activists of global justice movement, the International Forum on Globalization (IFG) is considered important as such famous figures as Maude Barlow, Walden Bello, Lori Wallach, Tony Clarke, Vandana Shiva and David Korte were its members. When anti-globalization protest occupied the streets of Seattle, many of its activists realized the necessity to go further and to work out alternative economic ideas how to prevent development of corporate globalization.Thus, they created the World Social Forum and the book â€Å"Alternative to Ec onomic Globalization† appeared to be a direct reflection of discussions during the protests. The book is a struggle against globalization reveals the ills of radical economic actions, participatory democracy, and social justice. However, the book isn’t official ideology, but serious reflection. (Brown & Renner 2006) The book provides two theoretical lines – the first criticizing corporate globalization and power, and the second discussing alternative ideas and principle for better society.However, the term â€Å"capitalism† is rarely used as a category of analysis. The author, instead, try to discuss the global corporate power. Cavanagh and Mander claim that the basis for global social and economic crisis is â€Å"rooted in – corporate globalization itself† (Cavanagh & Mander, 32) and that â€Å"globe-girdling firms (are) the driving forces behind the new architecture for global governance and the trade, finance, and investments regimes that now rule people and life on earth†. (p. 122)The book also offers thorough analysis of the institutional form of capitalism, but â€Å"without an analysis of capitalism they are reduced to surface descriptions without recognizing the class relations at the core of global corporate structure†. To prove their position, the authors state that the â€Å"absolute imperative to make a profit† and the â€Å"imperative to continuously grow and expand† (p. 130) are likely to be â€Å"rooted in the institutional forms and structures† of corporate behaviour.Nevertheless, these imperatives are more likely to be rooted in the structural logic of capitalism which is exhibited in the form of global corporations. If too look deeper, it becomes apparent that the mentioned imperatives are to promote class societies relations with the purpose to distort current principles and beliefs of culture and civil society. Profit making and expansion are the key goals of global corporate structure in the current world.

Ethical Issue on the Internet

Ethical issues relating to the use of the Internet and the implications for managers and business practice. by Mihai C. Orzan Abstract When we address the topic of ethical issues on the Internet we are generally referring at two different matters: privacy and intellectual property. Each has been examined extensively in the last five years, since the Internet explosive intrusion in everyday life activities, each has an important number of sub fields that require special attention from managers and other business professionals.The purpose of this paper is to to make a short presentation of most relevant developments pertaining Internet ethical issues in direct connection with the business world. The Privacy debate is centered on the arguments regarding citizens’ right to privacy granted or implied by laws on one hand and companies approach on â€Å"customer data, considered an asset to sell for profits† (Choi, 2000, p. 317) on the other hand. Privacy on the Internet is ex ploding as a topic of public concern these days. A recent Internet survey showed that 4 out of 5 users have major concerns regarding various privacy threats when they’re online.Yet only 6% of them have actually experienced privacy abuses. Those who are not yet on the Net cite privacy as the main reason they have chosen not to become Internet users. If electronic commerce is going to thrive, this fear is going to have to be dealt with by laws and by industry practices and this paper attempts to give a thorough description of the major computer ethics trends of the moment. The other major source of concern for business world as well as the majority of Internet users is copyright control.Serious question come from both approaches on this matter: what information available on the Internet can I freely use and how can one protect the hardly earned information that he posts on a website. In fact, â€Å"The Internet has been characterized as the largest threat to copyright since it s inception. It is awash in information, much of it with varying degrees of copyright protection. † (O’Mahoney, 2001). Copyrighted issue constitutes an important part of this paper and it details most of the present concerns of intellectual property. 1 Privacy Everyone has the right to know what information is collected and how it will be used and to accept or decline the collection or dissemination of this information– particularly financial and medical information. † President George W. Bush. Privacy has become a major concern on the Internet. According to (Ferrell, Leclair & Fraedrich, 1997), â€Å"the extraordinary growth of the Internet has created a number of privacy issues that society has never encountered before and therefore has been slow to address. † Opinions have been expressed and actions were taken in order to resolve these matters in one way or another.In an interview earlier this year United States President George W. Bush (Miller, 2 001) expressed numerous and informed concerns regarding privacy issues, including access, security, and use of personal information. He promised to ensure actions that will meet consumer demands for privacy protection and advocated â€Å"opt- in† policies for mailing lists. He concluded the interview by stating: â€Å"I share many people's concerns that, with the advent of the Internet, personal privacy is increasingly at risk, and I am committed to protecting personal privacy for everyone. Privacy issues on the Internet relate to two major concerns. The first concern is users’ ability to control the rate, type, and sequence of the information they view. Spam, or unsolicited commercial e- mail, is a control concern because it violates privacy and steals resources. A second concern relates to the ability of users to address and understand how organizations collect and use personal information on the Internet. Many 2 Web sites require visitors to identify themselves and provide information about their wants and needs.Some Web sites track visitors’ â€Å"footsteps† through the site by storing a cookie, or identifying string of text, on their computers. The use of cookies can be an ethical issue, especially because many users have no idea that this transfer of information is even occurring. Internet privacy is an important ethical issue because most organizations engaging in e- commerce have not yet developed policies and codes of conduct to encourage responsible behavior. Spamming â€Å"Junk e- mail and spam are both terms for advertising and e- mail sent to you which you did not ask for and which you do not want†, (Elbel, 2001).However, spam is a more generic term that includes broadcast posting to newsgroups as well as individuals. And spamming is very costly for the end users: recent surveys showed that various forms of spam consume up to 15% of Internet bandwidth. According to a recent European Union study â€Å"junk email costs all of us some 9. 4 billion (US) dollars per year, and many major ISPs say that spam adds 20% of the cost of their service†, (Elbel, 2001). As you can see spamming is a very profitable endeavor and have grown over the years to assume a number of different forms.Thus, we can distinguish: v Unsolicited e- mail is any email message received where the recipient did not specifically ask to receive it. It might not be always an abuse. v Bulk e- mail is any group of messages sent via e- mail, with substantially identical content, to a large number of addresses at once. Many ISPs specify a threshold for bulk e- mail to be 25 or more recipients within a 24- hour period. Once again, bulk e- mail itself is not necessarily abuse of the e- mail system. 3 Unsolicited Commercial E- mail (UCE) is a form of e- mail containing commercial information that has been sent to a recipient who did not ask to receive it. Several ISPs specify that sending even one UCE is a violation of privacy. v Make Money Fast (MMF) are e- mail messages that â€Å"guarantee immediate, incredible profits! â€Å", including such schemes as chain letters. v Multi-Level Marketing (MLM) are e- mail messages that â€Å"guarantee incredible profits! â€Å", right after you send them an â€Å"initial investment† and recruit others. v Mailbomb is probably the most harmful type of spamming.It takes the form of email packages delivered repeatedly to the same address until the mailbox is overloaded, or perhaps even the system that hosts the mailbox crashes. Mailbombs generally take one of two forms. A mailbox might be targeted to receive hundreds or thousands of messages, making it difficult or impossible for the victim to use their own mailbox, possibly subjects them to additional charges for storage space, and might cause them to miss messages entirely due to overflow. This is seen as a denial- of- service attack, perhaps also harassment.Another form of mailbombing is to forge subscripti on requests to many mailing lists, all for one recipient. The result is a huge barrage of email arriving in the victim's e- mail box, all of it unwanted, but â€Å"legitimate†. There are several ways to escape spamming, but none will guarantee 100 percent reliability. First, a complaint to the ISPs that originated and forwarded the spam is required. It is also recommended to switch to an ISP that uses one or all of the anti- spam databases available (RBL, RSS, and DUL). About 40% of the Internet is using these services, with good success.Also, it is important that you never, under any circumstance, reply to junk e- mail, even if it is to send a â€Å"remove† request. Most spammers ignore such 4 responses, or worse, add you to their list of validated e- mail addresses that they sell. Also, getting removed doesn't keep you from being added the next time they mine for addresses, nor will it get you off other copies of the list that have been sold or traded to others. Fina lly, we should note that there are voices that argue that spamming is a legitimate form of expression and restricting it would be a First Amendment infringement.Even more, has been suggested that â€Å"junk e- mail (also called â€Å"bulk† e- mail and â€Å"spam†) should be legally protected†, (D’Ambrosio, 2000). Tracking a user on the Internet Data about individuals is collected in a wide variety of ways, including information provided on application forms, credit/debit card transactions, and cookies. Many users expect that such activities are anonymous, but unfortunately they are far from being so. It is possible to record many online activities, including which newsgroups or files a subscriber has accessed and which web sites a subscriber has visited.This information can be collected both by a subscriber's own service provider (available in the request headers of browsers) and by agents of remote sites which a subscriber visits. But the most popular fo rm of collecting data about web surfers is the cookie. These are short pieces of data used by web servers to help identify web users. The cookie is stored on the user's computer, but contrary to popular belief it is not an executable program and cannot do anything harmful to the machine. Cookies are used by Internet shopping sites to keep track of users and their shopping carts.When someone first visits an Internet shopping site, they are sent a cookie containing the name (ID number) of a shopping cart and other useful tags. Another use of cookies is to create customized home 5 pages. A cookie is sent to the user’s browser for each of the items they expect to see on their custom home page. One of the less admirable uses of cookies, and the one that is causing all the controversy, is its use as a device for tracking the browsing and buying habits of individual web users.On a single web site or a group of web sites within a single subdomain, cookies can be used to see what web pages you visit and how often you visit them. However, such concerns can be easily addressed by setting the browser to not accept cookies or use one of the new cookie blocking packages that offer selective cookie access. Note that blocking all cookies prevents some online services from working. Also, preventing the browser from accepting cookies does not confer anonymity; it just makes it more difficult to be tracked on the Web. Related to cookies, but more damaging is the activity known as â€Å"prying†.Many of the commercial online services will automatically download graphics and program upgrades to the user's home computer. News reports have documented the fact that certain online services have admitted to both accidental and intentional prying into the memory of home computers signing on to the service. In some cases, personal files have been copied and collected by the online services. Use of Personal Information You can find out simple directory information about peopl e on a variety of web sites, like Switchboard, Whowhere, Four11, Bigfoot.These contain information retrieved from telephone books. And most of these sites allow someone who doesn’t want to be listed in their databases to have his/her information removed. But beyond the free services there are the fee- based services where one can find out a great deal about 6 individuals on the Internet. There are services like as KnowX, Informus, Infotel, CDB, Infotek, Information America, and Lexis- Nexis that offer subscription based services and give access either through the Internet or through their own telephone networks.The information they provide is primarily from public records like records of court cases, both civil and criminal (not the full text, not yet anyway, but an index of cases), bankruptcies, judgments and liens, property records, such as county tax assessors files, professional license information, if regulated by the state, Dept of Motor Vehicle data from many states, v oter registration data from many states, stock investments, if you own 15% or more of a company’s stock, and many more other sources.Data warehouses built with this kind of sensitive personal information (including â€Å"browsing patterns,† also known as â€Å"transaction- generated information†) are the lifeblood of many enterprises that need to locate their customers with direct mailing (or e- mailing) campaigns. It may also create the potential for â€Å"junk e- mail† and other marketing uses. Additionally, this information may be embarrassing for users who have accessed sensitive or controversial materials online. In theory, individuals (data subjects) are routinely asked if they would permit their information to be used by the information collector.Application forms usually include a clause stating that personal information provided may be used for marketing and other purposes. This is the principle of informed consent, meaning that if the individual does not so request that his/her data not to be used for such purposes, it is assumed that he/she had given permission. The alternative principle, of affirmative consent, where an individual is required to give permission for each and every occasion on which a data user wishes to make use of an individual’s data, becomes extremely expensive and complex and is seldom practiced.The Federal Trade Commission is urging commercial web site operators to make public their information collection practices in privacy policies posted on web sites. 7 Many web sites now post information about their information- collection practices. You can look for a privacy â€Å"seal of approval,† such as TRUSTe, Council of Better Business Bureaus (BBB), American Institute of Certified Public Accountants, WebTrust, and others on the first page of the web site. Those that participate in such programs agree to post their privacy policies and submit to audits of their privacy practices in order to display the logo.There are several technologies that help online users protect their privacy. v Encryption is a method of scrambling an e- mail message or file so that it is unintelligible to anyone who does not know how to unscramble it. Thus, private information may be encrypted, and then transmitted, stored or distributed without fear that outsiders will have access to its content. Various strong encryption programs, such as PGP (Pretty Good Privacy) and RSA (RSA Data Security) are available online.Because encryption prevents unauthorized access, law enforcement agencies have expressed concerns over the use of this technology, and Congress has considered legislation to create a â€Å"back door† to allow law enforcement officials to decipher encrypted messages. Federal law limits exporting certain types of encryption code or descriptive information to other countries and file them under the same ammo type as nuclear weapons. v Anonymous remailers. Because it is relatively easy to determine the name and email address of anyone who posts messages or sends e- mail, the practice of using anonymous remailing programs has become more common.These programs receive e- mail, strip off all identifying information, and then forward the mail to the appropriate address. v Memory protection software. Software security programs are now available which help prevent unauthorized access to files on the home computer. For 8 example, one program encrypts every directory with a different password so that to access any directory you must log in first. Then, if an online service provider tries to read any private files, it would be denied access. These programs may include an â€Å"audit trail† that records all activity on the computer's drives.Censorship and Blocking Software â€Å"With its recent explosive growth, the Internet now faces a problem inherent in all media that serve diverse audiences: not all materials are appropriate for every audience† (Resni ck & Miller, 1996). Any rules or laws about distribution, however, will be too restrictive from some perspectives, yet not restrictive enough from others. Apparently it might be easier to meet diverse needs by controlling reception rather than distribution. In the TV industry, this realization has led to the V- chip, a system for blocking reception based on labels embedded in the broadcast stream.On the Internet, the solution might be considered even better, with richer labels that reflect diverse viewpoints, and more flexible selection criteria. Not everyone needs to block reception of the same materials. Parents may not wish to expose their children to sexual or violent images, businesses may want to prevent their employees from visiting recreational sites during hours of peak network usage, and governments may want to restrict reception of materials that are legal in other countries but not in their own.The blocking solution with the largest acceptance at this moment is PICS (Pla tform for Internet Content Selection). Its labels are supposed to be able to describe any aspect of a document or a Web site. As was natural to be expected, PICS labels started out as an attempt to block web pages that were not compliant with indecency 9 laws. As one of its initiators said, â€Å"the original impetus for PICS was to allow parents and teachers to screen materials they felt were inappropriate for children using the Net†, (Weinberger, 1997).At this moment, Microsoft, Netscape, SurfWatch, CyberPatrol, and other software vendors have PICS- compatible products, while AOL, AT WorldNet, CompuServe, and Prodigy provide free blocking software that is PICS- compliant. Intellectual Property Intellectual Property concerns the protection of â€Å"all products created or designed by human intellect – book, songs, poems, trademarks, blueprints†¦and software† (Davidson, 2000, p. 9). The copying of software programs, although nominally protected by copyright laws, is certainly widespread. Much of the argument about IP lies in the deontological dichotomy between rights and duties†, (Davidson, 2000, p. 12). Software producers claim that they have the right to protect the fruit of their endeavors, and have the right to be compensated for the resources spend in the development process, while consumers claim that they have the right to use a product for which they have paid and expect that the product will be free of defects. This should lead to competitively priced products with superior quality, providing value for money. 10 Copyright, Patents, and TrademarksAccording to prof. Johnson (2000) â€Å"as computing resources become more and more prevalent, computer software becomes easier and easier to access, and as such, easier and easier to copy†, (p. 124). Protection for one’s work, from a legal point of view, requires copyright, patents, and trademarks for sensible and strategic information. The best approach is to hav e a combination of trade secret protection, copyright laws, and trademark laws for the product in question because these are cheap, effective, and fast ways of protecting a software product from being pirated.Copyright Issues Copyrighted works on the net include news stories, software, novels, screenplays, graphics, pictures, Usenet messages and even e- mail. â€Å"In fact, the frightening reality is that almost everything on the Net is protected by copyright law† (O’Mahoney, 2001). Software and manuals, as novels and other literary works, are protected under copyright laws. In simple terms, this guarantees the copyright owner, the author in most cases, the exclusive rights to the reproduction and distribution of his intellectual property.Thus, copyright law guarantees the owner of the intellectual property the same types of rights that patent law guarantees the owner of an invention or other piece of seemingly more tangible physical property. Computer software and dat a are intellectual property, and as such are covered by copyright law. The problems start when people cannot, or will not, make the mental transition from physical to intellectual property. While most people would not steal books from a bookstore or a software package from a dealer's showroom, 11 ven if they knew they would not be caught, many of the same people would not hesitate copying a computer program from a demo or from their friends and colleagues. The only free software is the one places in the public domain, also known as freeware. For the rest of the software products the user must abide by the license agreements which usually come with a program and places restrictions upon reproducing and distributing the software, including such things as loaning the software to a friend or colleague and making duplicates for classroom or network use. Some licenses even go so far as to restrict use to a specific computer.In most cases, however, the user does have the right to make a ba ckup copy of the software for archival purposes. In theory, any use of a software package which falls outside of the limits of the license agreement renders the user, and quite often the user's company or institution, liable to prosecution. A computer program is defined in the copyright law as â€Å"a set of statements or instructions to be used directly or indirectly in a computer in order to bring about a certain result. † Copyright protection begins at the time a work is created in fixed form; no act other than creation of the work is required to obtain a copyright for the work.According to (Yoches and Levine, 1989) â€Å"the scope of copyright protection for a computer program's expression may extend beyond its literal code to the structure, sequence and organization of the program. † Another debated and important aspect of software copyright involves the use of databases, data warehouses, and other forms of data collections. Under traditional concepts of literary copyright, the data contained in a compilation, and the selection of the data, may sometimes not be protected from copying. Only the coordination and arrangement of the database may be protected, and even then there must be some originality to the collection and arrangement for it to be protected†, (Losey, 1995). 12 There are essentially three ways to legally protect computer databases: copyright, trade secret and contract. Raw facts in a database may not be protected by copyright, regardless of the time or expense that went into locating them. However, in many databases the data itself, or the particular expressions of the facts, may have been created by the author. In such cases the data has originality and can be protected.Even if the contents are raw facts, not new materials created by the author, the compilation aspects of the database (selection, coordination and arrangement) may still receive copyright protection. A trade secret is â€Å"knowledge which a person or com pany acquires through its own efforts and which has some value to it† (Losey, 1995). Typically, this knowledge is kept secret from competitors because it is felt that this information provides some type of competitive advantage. Since a computer database is a compilation that derives economic value, it is a type of intellectual property that has frequently received trade secrecy protection.Finally, the owner of a database can require that any purchaser enter into a written contract as a condition of purchase of the database. That written agreement could expressly provide that the purchaser will not disclose the content to anyone but authorized users, nor make any copies or unauthorized use of the information. Typically this takes the form of a License Agreement between the owner/licensor of the database and the user/licensee of the database. Protect your site against theft It might be useful to know that a link is a URL, a fact not unlike a street address, and is therefore not copyrightable.However, a URL list may be copyrightable under a 13 compilation copyright if it contains some originality. The Internet was created on the basis of being able to attach hypertext links to any other location on the Web. Consequently, by putting yourself on the Internet, â€Å"you have given implied permission to others to link to your Web page, and everyone else on the Web is deemed to have given you implied permission to link to their Web pages† (O’Mahoney, 2001). The two primary methods of protection are technical countermeasures and legal protection.Technical countermeasures include strategies such as digital watermarking and spiders that search the Internet for copies of your pages or graphics. These strategies tend to be difficult, expensive, and user- unfriendly. The primary vehicle for legal protection is copyright. This is by far the easiest and most popular form of protection in use today. In implementing a copyright strategy, there are three ite ms that you should consider: v Ownership: before trying to copyright your website, a clear understanding of what exactly it is considered to be copyrighted is required.There are many elements to a website, including text, graphics, scripts, data, and code. If everything was created from scratch for the website, ownership is not an issue. However, if someone else created text, or some clip art was downloaded from another website, or scanned photographs from archives were used, or a web design firm was hired to load all informational content into an attractive package, then ownership of the respective elements is shared with the original creators, unless otherwise stated in contracts and licenses. Copyright notice: it is generally a good idea to put a copyright notice on your website. It used to be that in order to be afforded any copyright protection whatsoever, one needed to put the world on notice by attaching a copyright notice to the work. While this is no longer the case, it is still customary to attach a 14 copyright notice on copyrighted works in order to be eligible for certain types of damages. The copyright notice consists of at least elements that include the copyright symbol and/or the term â€Å"Copyright†, the year of copyright, and the name of the copyright holder. Registration: register your copyright with the Copyright Office. Although the Copyright Act gives protection just for creating your work and reducing it to a tangible form, that protection proved somewhat illusory in some cases when registration was overlooked. Patents and Trademarks â€Å"A recognized brand name or trademark represents the goodwill that has been built into the product or service†, (Eldenbrock & Borwankar, 1996). Consumers tend to associate the recognized brand name or trademark with certain characteristics that are specific to that name or mark.Therefore, companies often spend millions of dollars annually for safeguarding the investment in the related in tellectual property rights. Trademark laws protect the name of the software, not the software itself. Some examples include: â€Å"Lotus 1- 2- 3†, â€Å"Apple â€Å", â€Å"D- BASE†, â€Å"WordPerfect†, and many others. Copyright protection protects the expression of an idea, not the idea itself. A patent protects the idea itself. There are two major drawbacks to patents. They take a lot of money and a lot of time (usually two or more years).Computer games are rarely patent protected because the shelf life for a game is usually no more than six months. 15 Fair Use â€Å"When the fair use doctrine applies to a specific use of a work, the person making fair use of the work does not need to seek permission from the copyright owner or to compensate the copyright owner for the use of the work†, (Lehman, 1998). The fair use is a form of limitation of the exclusive rights of copyright owners for purposes such as criticism, comments, news reporting, teaching (i ncluding the possibility to make multiple copies of a copyrighted work for classroom use), scholarships, or research.In order to determine whether the use made of a work in any particular case is not a copyright infringement, Smith’s (2001) Copyright Implementation Manual offers the following guidelines: 1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; 2. the nature of the copyrighted work; 3. the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and 4. the effect of the use upon the potential market for or value of the copyrighted work.The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors. Those creators and authors who wish to dedicate their works to the public domain may, of course, do so notwithstanding the availability of protection under the Copyrigh t Act. 16 Libel and Defamation â€Å"We know that as the Internet grows, there will be more and more lawsuits involving libel and defamation. † said attorney David H. Donaldson, editor of Legal Bytes, â€Å"The only question is if the number of cases will grow steadily or if there will be an explosion of lawsuits all at once. The Internet has been used to harass, slander, threat and these online activities led to arrests, successful sues (because have used netnews to slander and for delivering inappropriate screen saver images) and other forms of legal punishments. The most frequent form of libel on the Internet is flaming, defined as â€Å"the practice of sending extremely critical, derogatory, and often vulgar e- mail messages, or newsgroup postings to other users on the Internet or online services† (O’Brien, 2002, pp. 326).Famous cases of racism or defamation have turned the attention at the gaps in legislation regarding Internet crime. Sexual explicit web p ages are responsible for another stir in social awareness regarding Internet- related legal void. Sometimes even a â€Å"link to another's page could be defamatory and may subject someone to legal liability†, (INET Legal Networks, 2001), if it links to a page where offensive or illegal content is present and if you do not give strong warning to the web surfer about the consequences of his/her â€Å"click†.There are a number of features unique to the Internet that distinguish it from any other medium and have â€Å"led to the current re- examination of existing libel laws to allow for their possible evolution and ultimately their application in the cyberspace†, (Potts & Harris, 1996). 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This feature, coupled with the ability to access the Internet in the privacy and seclusion of one's own home or office and the interactive, responsive nature of communications on the Internet, has resulted in users being far less inhibited about the contents of their messages than in any other form of media. Computer Crime One of the biggest threats for the online community comes from various ways in which a computers network in general and the Internet in special might be used to support computer crime.The list of such actions is vast as â€Å"criminals are doing everything from stealing intellectual property and committing fraud to unleashing viruses and committing acts of cyber terrorism† (Sager, Hamm, Gross, Carey & Hoff, 2000) and a few of the most dangerous and common ones have already entered the general IT folklore. 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According to Zwass (1997), â€Å"deterrent controls (legal sanctions) and preventive controls (increasing the cost of piracy by technological means) can be used to combat software piracy. † Information technology is a key driver in the globalization and growth of the world economy. In a recent study of worldwide software market (International Data Corporation, 1999) the total worldwide package software market has been st imated at $135 billion. Worldwide expenditures on software are expected to increase to about $220 billion by the year 2002. The U. S. software industry is reaping the benefits of this hyper growth, having captured 70% of global software sales. According to (Software Publishers Association, 1998), the worldwide revenues of business- based PC applications was $17. 2 billion, but global revenue losses due to piracy in the business application software market were calculated at $11. 4 billion.This is very similar to the report of (International Research and Planning, 2001)’s Business Software Alliance (BSA), a watchdog group representing the world’s leading software manufacturers, which announced the results of 19 its sixth annual benchmark survey on global software piracy. The independent study highlights the serious impact of copyright infringement with piracy losses nearing $11. 8 billion worldwide in 2000. Figure 1 shows an interesting correlation between the national piracy rates compiled by the SPA with the per capita GNP for 65 countries in the year 1997.Higher software piracy rates are heavily skewed towards countries with low per capita GNP. The effect of GNP is much more pronounced for the countries with GNPs less than $6,000, as shown in Figure 2. Each $1,000 increase in per capita GNP is associated with a nearly 6% decrease in the piracy rate. These results indicate a significant income effect on the global piracy rates, particularly in the poorer segments of the world. The different ways of illegally copying computer software can be broken down into five basic ways of pirating. Counterfeiting is duplicating and selling unauthorized copies of software in such a manner as to try to pass off the illegal copy as if it were a legitimate copy produced by or authorized by the publisher. v Softlifting is the purchasing of a single licensed copy of software and loading it on several machines, contrary to the terms of the license agreement. This i ncludes sharing software with friends and co- workers. v Hard- disk loading is selling computers pre- loaded with illegal software. v Bulletin-board piracy is putting software on a bulletin- board service for nyone to copy or copying software from a bullet in- board service that is not shareware or freeware. v Software rental is the renting of software for temporary use. An interesting study regarding software piracy in academic environment was conducted at the Faculty of Business at the City University of Hong Kong (Moores & 20 Dhillon, 2000). A total of 243 usable responses were received, of which 122 were female and 121 were male. As shown in Figure 3, 81% of the respondents report they buy pirated software on a regular basis, with a significant minority (29%) buying every month, and 3% even reporting they buy several times a week.The most popular pirated software bought was spreadsheets, followed by programming languages, databases, word processors, and statistical packages. Oth er software mentioned included e- mail, graphics, and game software. Only 7% claim to have never bought pirated software. Illegal Information The Internet was designed as an inherently insecure communications vehicle. This allowed an impressive number of security gaps that led to numerous hacking techniques. Probably the most famous one at this moment is the denial of service attack, that led to the shutdown of many famous Internet sites, including Yahoo! , eBay, Amazon, and CNN.Other hacking tactics include spoofing (faking an web page to trick users into giving away critical information), Trojan horses (programs that are planted on user’s machine without his knowledge), logic bombs (instructions in computer programs that triggers malicious acts), and password crackers. According to Givens (2001), â€Å"Identity thieves are able to shop online anonymously using the identities of others. 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As mentioned before, possession or export of certain types of cryptographic techniques is a very serious federal crime.AMA Code of Ethics of Marketing on the Internet â€Å"All professionals find a code of ethics is useful to guide them through the sometimes thorny issues that confront them† (Klampert, 1998). Codes of ethics are an orga nized, written set of rules that describe expected behaviors. There are many such codes in Information Systems (ACM, IEEE, British Computer Society), but none of them has overall recognition. Most institutions that provide Internet access have formulated policies and procedures regarding the fair use of their facilities.The most frequent policies are grouped under the following categories: a Code for Ethical Computer Use (usually a written policy an institution has developed to describe ethical use of their computer system), an E- mail Privacy Policy, and an Internet Access Policy. One of the most representative such codes for the Internet community is the one that has been imposed by the American Marketing Association for its members. Below there are a few of the most interesting requirements, as they can be found in the latest edition of (AMA, 2001) Code of Ethics for Marketing on the Internet: 2 Adherence to all applicable laws and regulations with no use of Internet marketing th at would be illegal, if conducted by mail, telephone, fax or other media. Organizational commitment to ethical Internet practices communicated to employees, customers and relevant stakeholders. Information collected from customers should be confidential and used only for expressed purposes. All data, especially confidential customer data, should be safeguarded against unauthorized access. The expressed wishes of others should be respected with regard to the receipt of unsolicited e-mail messages.Information obtained from the Internet sources should be properly authorized and documented. Marketers should treat access to accounts, passwords, and other information as confidential, and only examine or disclose content when authorized by a responsible party. The integrity of others' information systems should be respected with regard to placement of information, advertising or messages. Conclusions This R paper gives a general overview of the most debated ethical issues related to the us e of Internet and their implications for managers and business practice.However, there are several other less critical aspects that should be considered by a very thorough revision and some very interesting papers on these subjects are listed in Appendix C. These aspects include unauthorized use of computer resources at work, accessing individuals’ private e- mail and telephone conversations and computer records by the companies they work for and other forms of computer monitoring, challenges to 23 work conditions and individuality that are brought about by computer systems, mistaken computer matching of individuals, and many, many more.To protect themselves and the people they work with, information professionals need to be as professional as they can be and, sometimes, must decline a project if clients insist that they do something they have moral objections about. Ethical considerations are inherent for any IT professional. Moral behavior, including acting with integrity, increasing personal competence, setting high standards of personal performance, accepting responsibility for your actions, avoiding computer crime, and increasing the security of computer systems developed are just a few of many such considerations.Overall, I believe that there is a critical need for heightened debate on professional ethics in Information Systems. 24 Appendix A Figure 1. Per capita GNP and piracy rates. Figure 2. Piracy rates and per capita GNP less than $6000 25 Figure 3. Frequency of pirated software. 26 Appendix B Cited Works 1. Choi, S. – Y. & Whinston, A. B. (2000). The Internet Economy: Technology and Practice. Austin, TX: SmartEcon Publishing. 2. D’Ambrosio, J. (2000,. January). Should â€Å"Junk† E- mail Be Legally Protected? [online]. Available: http://www. fmew. com/archive/junk/. October 26, 2001). 3. Davidson, Robert (2000, April). Professional Ethics in Information Systems: A Personal Perspective. Communications of the AIS, Vol. 3, Article 8. 4. Elbel, F. (2001, October 23). Junk E- mail and Spam. [online]. Available: http://www. ecofuture. org/jmemail. html. (October 26, 2001). 5. Elderbrock, David and Borwankar, Nitin. (1996). Building Successful Internet Businesses: The Essential Sourcebook for Creating Businesses on the Net. Foster City, CA: IDG Books Worldwide. 6. Ferrell, O. C. , Leclair, D. T. , & Fraedrich, J. P. (1997, October).Integrity Management : A Guide to Managing Legal and Ethical Issues in the Workplace. O’Collins Corp. 7. Givens, Beth. (2001, March). A Review of Current Privacy Issues. [online]. Available: http://www. privacyrights. org/ar/Privacy- IssuesList. htm. (October 26, 2001). 8. Hard- Davis, G. (2001, March). Internet Piracy Exposed. Alameda, CA:Sybex. 27 9. INET Legal Networks (2001). Defamation – Law for Internet [online]. Available: http://www. lawforinternet. com/subject_defamation. php3? searchkys=defamation =topdefamation. html. (October 26, 2001). 10.Internationa l Data Corporation (1999, February 10). Distribution of Worldwide Software Revenues Vary Dramatically [online]. Available: www. idcresearch. com/Press/default. htm. (October 26, 2001). 11. International Research and Planning. (2001, May). Sixth Annual BSA Global Software Piracy Study. [online]. Available: http://www. bsa. org/resources/200105- 21. 55. pdf. (October 26, 2001). 12. Johnson, Mark B. (2000, January). Software Piracy: Stopping It Before It Stops You. Proceedings of the sixteenth ACM SIGUCCS Conference on User Services. pp. 124- 131. 13. Klampert, Elizabeth (1998, July 13).Business Ethics for Information Professionals. Proceedings of the AALL 1998 Conference on Independent Law Librarian Program, Anaheim, CA. 14. Lehman, B. A. , (1998). The Conference on Fair Use: final report to the commissioner on the conclusion of the Conference on Fair Use. Washington, DC: Office of Public Affairs U. S. Patent and Trademark Office. 15. Losey, Ralph C. (1995). Practical and Legal Protec tion of Computer Databases [online]. Available: http://www. eff. org/Intellectual_property/database_protection. paper. (October 25, 2001). 16. Miller, M. J. (2001, February 6).Bush’s Privacy Plan. PC Magazine, Vol. 20, No. 3. 28 17. Moores, T & Dhillon, G. (2000, December). Software Piracy: A View from Hong Kong. Communication of the ACM, Vol. 28, No. 10, p. 88- 93. 18. O’Brien, J. A. (2002). Management Information Systems: Managing Information Technology in the E- Business Enterprise. New York, NY: McGraw- Hill. 19. O’Mahoney, B. (2001). Copyright Website [online]. Available: http://www. benedict. com/digital/digital. asp. (October 26, 2001). 20. Potts, David & Harris, S. (1996, May 16). Defamation on the Internet [online]. Available: http://owl. nglish. purdue. edu/handouts/research/r_apa. html. (October 26, 2001). 21. Resnick, P. & Miller, J. (1996). PICS: Internet Access Controls Without Censorship. Communications of the ACM, Vol. 39, No. 10, pp. 87- 93. 22. Sager, Ira, Hamm, Steve, Gross, Neil, Carey, John and Hoff, Robert. (2000, February 21). Business Week. 23. Smith, Steve. (2001, May). Copyright Implementation Manual [online]. Available: http://www. groton. k12. ct. us/mts/cimhp01. htm. (December 1, 2001). 24. Software Publishers Association (1998). SPA's Report on Global Software Piracy [online]. Available: www. pa. org/piracy/98report. htm. (October 26, 2001). 25. Weinberger, J. (1997, March). Rating the Net. Hastings Communications and Entertainment Law Journal, Vol. 19. 26. Yoches, E. Robert & Levine, Arthur J. (1989, May). Basic principles of copyright protection for computer software. Communications of the ACM Vol. 32 No. 5. pp. 544. 27. Zwass, Vladimir. (1997, Spring). Editorial Introduction. Journal of Management Information Systems, Vol. 13, No. 4, pp. 3- 6. 29 Appendix C Bibliography 1. American Marketing Association (2001). Full Text of the AMA Code of Ethics [online].Available: http://www. ama. org/about/ama/fulleth. a sp. (October 26, 2001). 2. Berman, J. & Weitzner, D. (1995). User Control: Renewing the Democratic Heart of the First Amendment in the Age of Interactive Media. Yale Law Journal, Vol. 104, pp. 1619. 3. BRINT Institute. (2001). Intelectual Property: Copyright, Trademarks and Patents. [online]. Available: http://www. brint. com/IntellP. htm. (October 26, 2001). 4. British Computer Society. (2000). British Computer Society Code of Practice [online]. Available: http://www. bcs. org. uk/aboutbcs/cop. htm. (November 30, 2001). 5. CETUS. (1995).Fair Use: A Statement of Principle [online]. Available: http://www. cetus. org/fair4. html. (December 1, 2001). 6. Cheng, H. K. , Sims, R. R. , and Teegen, H. (1999, Spring). To Purchase or to Private Software: An Empirical Study. Journal of Management Information Systems Vol. 13, No. 4, p. 49- 60. 7. Gopal, R. D. , & Sanders, G. L. (1997, Spring). Preventive and Deterrent Controls for Software Piracy. Journal of Management Information Systems Vol. 13 No. 4. pp. 29- 47. 30 8. Hinman, Lawrence M. (2001, September 15). Ethic Updates [online]. Available: http://ethics. acusd. edu/index. tml. (October 25, 2001). 9. Jamison, B. , Gold, J. & Jamison, W. (1997). Electronic Selling: 23 Steps to ESelling Profits. New York, NY: McGraw Hill. 10. Lending, D. & Slaughter, S. A. (2001, April). Research in progress: the effects of ethical climate on attitudes and behaviors toward software piracy. Proceedings of the 2001 ACM SIGCPR conference on Computer personnel research. p. 198- 200. 11. Limayem, Moez, Khalifa, Mohamed , Chin, Wynne W. (1999, January). Factors Motivating Software Piracy. Proceeding of the 20th international conference on Information Systems, p. 124- 13. 12.Scott, Thomas J. , Kallman, Ernest A. , Lelewer, Debra. (1994 November). Ethical Issues Involving the Internet. Proceedings of the conference on Ethics in the computer age. pp. 31- 32. 13. Thong, J. Y. L. , & Yap, C. – S. (1998, Summer). Testing and Ethical Decisi onMaking Theory: The Case of Softlifting. Journal of Management Information Systems Vo. 15, No. 1. pp. 213- 237. 14. U. S. Department of Energy Computer Incident Advisory Capability Information Bulletin. (1998, March 12). Internet Cookies. [online]. Available: http://ciac. llnl. gov/ciac/bulletins/i- 034. shtml. (October 26, 2001). 31

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International Law - Case Study Example In the give case, a totalitarian president, Barmy has invaded the adjacent sovereign state Whiteland using muscle power. Neither the people of Whiteland nor the political regime of the Whiteland, has not done anything wrong to provoke Barmy or the Redland. Moreover, the Redland president Barmy has not cited any reasons for his action and the annexation of the Whiteland. The above case has lot of similarities with the Saddam Husain's seizure of Kuwait. Kuwaiti people never liked the intrusion of Saddam into the Kuwait territories. Saddam's claim over Kuwait was unjustifiable and it was just an excuse Saddam put forward for attacking the neighboring state. By capturing Kuwait, Saddam has violated all the international laws regarding the sovereignty of a country or state. Sovereignty is one of the fundamental rights of each country. It is the claim of having supreme, independent authority over a territory which is recognized by the United Nations. All the nations irrespective of what political ideologies they follow should respect the sovereignty of other independent states. Muscle power and forces should never be exercised upon a sovereign state without proper reasons. Chapter VII of the United Nations Charter states that the use of force is justified under only two circumstances: in individual or collective self-defence, as outlined in Article 51, or pursuant to a Security Council resolution, as outlined in Article 42" (The War on Iraq: Legal Issues, 2003)1. In the given case, Barmy or the Redland was not at all under any threats from the Whiteland and Barmy's action cannot be justified. Nobody wants to be ruled by an autocratic or totalitarian administration. Such administration will use iron fist for suppressing the interests of the people. Freedom of expression or any other basic human requirements will definitely be denied by a totalitarian ruler. When Saddam captured Kuwait, the international community and the Kuwaitis shouted against Saddam because of their fear against such totalitarian approach from Saddam Husain. Barmy was a totalitarian ruler and under his administration the Whiteland people will become slaves having their freedom cut down to a big zero. Whiteland public has every right to decide about their administration and a civilized country will never wish to be under the administration of a totalitarian ruler at present. International law is an arcane subject for those at all levels of opinion, ranging from the general public to top opinion leaders (Perry, 1998). It is not possible for countries to progress by violating international laws. In a civilized society like the present one, integration of the interests of the people on a global basis is required. Globalization and Liberalization are policies aimed at the integration of the global public and the collective economic growth. Invading other countries for expanding the territories is a barbarian act which was prevalent in the ancient societies. But the advancements in science and technology and the earlier lessons learned from international conflicts like the world wars have drastically changed the social views about the expansion of territories. In short, capturing Whiteland, Barmy has violated all the international laws regarding the sovereignty, freedom, and legal rights of a country to select their administra

Ebay Strategy Essay Example | Topics and Well Written Essays - 750 words

Ebay Strategy - Essay Example As the report declares eBay operates the leading online auction community on the Internet. Secondly , the second strength is intellectual property .eBay’s intellectual property such as its trademarks, copyrights, patents and domain names will help to give the company a competitive advantage over its rivals in the market place. Then , Brand is one of the key strengths of eBay.The strength of the eBay brand name is increasing. The brand is now becoming more mainstream, as it benefits from an increase in both brand awareness and brand recognition. In addition , Double-digit growth in sales has been seen in a number of the company’s eight core product categories. Pay Pal is one of the most successful strategies for eBay.The acquisition of Pay Pal has helped the company to enhance the experience of customers using eBay.This has had a knock on effect and helped to boost the satisfaction of customers using eBay. Perhaps one of eBay’s biggest strengths is its business mo del. The company’s business model means that eBay has no inventory and low capital requirements. This paper stresses that there are also some weaknesses of eBay strategy .The first is advertising revenues. Although advertising revenue only represents a small proportion of revenues, it is an area where eBay should be looking to exploit in order to generate greater revenues for the company as a whole. The second one is technology development. eBay still needs to improve a number of areas of its website in order to generate increased sales in the future.

Death Sentence Errors or Gun Control Term Paper

Death Sentence Errors or Gun Control - Term Paper Example A moral and legal analysis of the second amendment can help in clarifying whether infringement of right of owning and carrying arms should be allowed or disallowed. Firstly, there are no rights that are absolute in nature; even the rights that Americans have been allotted by God and by the Bill of Rights have certain limitation. Similarly, the right of owning and carrying arms cannot even be absolute and can be infringed upon if the person having a particular right is indulged in the act of misusing his/her right. The absolute nature of the right of owning and carrying arms has been challenged by the courts itself for several times. For example during the Miller case which took place during the 20th century, the court ruled that citizens of US are only allowed to carry certain kinds of weapons and not all weapons (Uviller 21). Later in the case of Stevens v. US, the court ruled that citizens cannot be awarded the duty of militia until they become an official of the militia and the ri ght of owning and carrying arms should only be limited to the militia (Carter 558). This writing will focus on the reasons due to which gun control laws should not be implemented. Gun control laws should not be implemented because law abiding citizens use guns as a self defense against goons who use are armed, secondly, guns in the hands of law abiding citizens deters crime and criminals and gun control laws can only control guns that are registered to the names of law abiding citizens and cannot control guns that are in the hands of criminal minds. Body Issues Associated with Guns According to the statistics of the period of 2010, 358 of individuals were murdered with the use of rifles, 6,009 were murdered through hand guns and 1939 individuals experienced being shot through an unknown firearm (FBI, 2013). During the same period, a total of more than 19000 suicides were committed with the use of firearms. Various costs associated with the use of firearms include medical bills, insu rance cost, and costs experience by the US criminal justice system and during the period of 2010, these costs totaled to $174 billion due to incidences of violence conducted while using guns (Goldman, 2012). During the last month of 2012, a 20 year old guy named Adam Lanza went on a shooting rampage in the Sandy Hook Elementary School and took the precious lives of nearly 20 children and six faculty members of the school along with the murder of his own mom and later shot himself. These incidences clearly show that causing injury and killing others and oneself are the two main tasks of guns. Murders conducted with the assistance of a gun can be recognized as a 1st degree murder which means that the killer had intent of killing and a gun made the task easier. Other kind of murders that may take place includes: murder caused while another form of crime was taking place, murder of a friend due to passion and murders caused due to negligence that is criminal in nature. There have been v arious incidences where the murderer has no intention of committing a murder and was at the crime scene to commit another crime such as rape or theft, but the availability of an armed weapon makes the crime lethal. This means that individuals are not rational choice makers and at times they conduct behaviors which they initially

Emily Dickinson Essay Example for Free

Emily Dickinson Essay A poem, sonnet, short story, and other kinds of literature all seem useless if no one has ever read it. The true value of words can only be best appreciated when their meaning reaches other people. Emily Dickinson, one of the authors renowned to have produced some the finest literary pieces, has touched the hearts of many people all around the world through her works. Even today, years after she passed away, her works and influence linger for generations to come. There is no better way to understand the present without knowing and tracing the remnants of the past. Emily Dickinsons classics give people a better grasp of the kind of life that people lived during her time. Analyzing the writing style and the perspective of an author such as Dickinson will give the people a comparison of today and yesterday. Most authors write based on their experience or the surrounding environment, and studying these pieces of literature will provide a person with information about the author, his or her family, and daily living. Emily Dickinsons father was a lawyer and her mother was a housewife. She was born to a wealthy family in Massachusetts and was blessed with good education. She was proved to be an introvert yet an intelligent student. She started writing shortly after she attended the Mount Holyoke Female Seminary (Famous Poets and Poems, 2009). Most of her works center on the issues of death, immortality, nature, and faith. She dedicated her poem entitled â€Å"Safe in their Alabaster Chambers† to her friend and fellow author Thomas Wentworth who participated in the Civil War (Famous Poets and Poems, 2009). â€Å"Because I Could Not Stop for Death† is also one of her famous and well-talked about poems. It obviously talks about death and the afterlife. Some of the controversial lines are the following: â€Å"Because I could not stop for Death, / He kindly stopped for me. / The carriage held but just ourselves / And immortality† (Dickinson, 2000a, n. p. ). In the poem, the author uses the point of view of someone who has experienced eternity to describe it. She illustrates her lifes journey through childhood, maturity, and old age. Contrary to most views, the author describes death as a gentleman who came to take her towards the afterlife. Death is one of the topics she chose probably because it was during her time when the Civil War erupted, and all her loved ones were dying, like her friend Wentworth. Experiencing the death of a loved one makes a person contemplate about it. Emily Dickinson also gave breath to the famous quote, â€Å"love is life† and â€Å"If I could stop one heart from breaking† (Dickinson, 2000b, n. p. ; Dickinson, 2000c, n. p. ). Love is the shortest most powerful word that ever existed. The author is correct when she said that â€Å"love is life† because its power transcends death (Dickinson, 2000c, n. p. ). During the 19th century, people fought hard for life and love. That is why most works coming from these times talk so passionately and deeply about it. â€Å"If I Could Stop One Heart from Breaking† is another classic that talks about what a person can do to help another being. She expounds further by saying that her life would not be in vain if she could help ease a persons pain (Dickinson, 2000b). Life is too short to be wasted for selfish reasons, and as such, the life of an individual who takes the time to go an extra mile for others will not be in vain. Emily Dickinsons works are priceless because they will never go out of style, and her words of wisdom can be applied all throughout the ages. She had a rough life, and she clearly made her point using her words. She is one of the most acknowledged and successful authors of all time not only because of her unique and classical perspective, but also because she succeeded in giving the people of today a peek of what it felt like to have lived and loved in the 19th century. References Dickinson, E. (2000a). Because I could not stop for death. The Complete Poems of Emily Dickinson. New York: Bartleby. com.Retrieved June 22, 2009, from http://www. bartleby. com/113/4027. html. Dickinson, E. (2000b). If I could stop one heart from breaking. The Complete Poems of Emily Dickinson. New York: Bartleby. com. Retrieved June 22, 2009, from http://www. bartleby. com/113/1006. html. Dickinson, E. (2000c). That I did always love. The Complete Poems of Emily Dickinson. New York: Bartleby. com. Retrieved June 22, 2009, from http://www. bartleby. com/113/3008. html. Famous Poets and Poems. (2009). Emily Dickinson Biography. Retrieved June 24, 2009, from http://famouspoetsandpoems. com/poets/emily_dickinson/biography.

Concepts and Theories of Auditing

Concepts and Theories of Auditing Auditing has been present for years in different stage of development following the evolution of accounting. Starting since the epoch when the records were approved after a public reading, to the era when governments officials were measured by their honesty. Followed by the times of the industrial revolution were the ownership of companies started separating from management; when owners required more protection of their investments increasing the use of auditors, consequently; to the times were an auditor was always searching for frauds or errors (Whittington Pany, 2004, p. 7) and then to ascertain the actual financial condition and earnings of an enterprise (Montgomery, 1913, p. 9). However, the acceptance of auditing as an academic discipline is not old and just after the development of different concepts and techniques within the audit model such as the use of sampling, the study of the internal control environment, and the risk assessment, is when more focus to the theoretical and conceptual framework of auditing it is been devoted. Andrew Sayer (1992) discussed the concept of theories in social science from the perspective of theory as an ordering-framework (p. 50), indicating that theory allows the use of the observed data and their relationships to predict and explain empirical events. Additionally Cooper and Schindler (1998) define theory as a set of systematically interrelated concepts, definitions, and propositions that are advanced to explain and predict phenomena (facts) (p. 47). Another concept is expressed by Singleton and Straits (2005) explaining theory as a set of interconnected propositions (p. 19). The success in the explanations or predictions of any phenomena depends on the level that the theory holds and do not fails fitting in the situation, and the challenge is to perfect the process of matching theory and fact (Cooper and Schindler (1998). Different authors have started the development of the audit theory such as Mautz and Sharaf (1961) with their publication titled The Philosophy of Auditing; also Tom Lee (1986) with his approach in the book Company Auditing, and later David Flint (1988) with his book Philosophy and principles of auditing (as cited in Moizer, 1989). The auditing analysis in this demonstration will be framed on the postulates proposed by David Flint (1988) as a foundation for the theory of auditing. Flint (1988) stated that there is a matter of public accountability demanding an independent audit for its demonstration with clear definition and intention, based on evidence that only skilled auditors gather, measure it, and compare it against the standards, which generates economic or social benefit (as cited in Moizer, 1989). Following are the seven postulates or assumptions stated by Flint (1988): There is a relationship of accountability or a situation of public accountability. Accountability cannot be demonstrated without an audit. An audit requires independence and freedom. The subject matter of audit is susceptible to verification by evidence. Auditors are skilled judges who are able to measure and compare actual performance against standards of accountability. The meaning, significance, and intention of statements to be audited must be clear. An audit produces an economic or social benefit. (Flink, 1989) Whenever an economic relationship exists one of the parties owe a duty of an acceptable accountability, consequently audits are voluntary, imposed for the health of the relationship. There are also audit related to the interest of the public in matters of the society institutions. As expressed by Whittington and Pany (2004) dependable information is essential to the very existence of our society (p. 1). They explained the social need for audit and professionals who can attest that the reported information is fair respect to the reality for purpose of allocating resources for the production of services and goods based on reliable financial information (p. 1). Normally the financial and economic aspects of the related subject matter are complex, not physically accessible, or have the level of significance that necessary demand an audit to accept the accountability. No all investors or stakeholders of an entity understand the complexity of the business and financial environment, or are near to the place were their resources are to oversee for accountability. The credibility of the information is important and the preferable form of obtaining credible information to rely on is by using independent auditors to perform an audit. That reduce the business risk that relates to the permanence and profits of the company, and the information risk that the financial information used to make a decision is materially misstated (Whittington Pany, 2004, p. 6). Therefore, if the audit must add credibility it must be performed independently and without bias or prejudice. Audit is subject to verification and that is possible only if sufficient evidential matter of the audit is gathered. Additionally, some standards of accountability and performance need to be in place to easy the auditors measurement. Therefore, the parties involved must agree on their acceptable standards. The auditing community has set some professional guidance as a form of general accepted practiced standards. For an audit to add value to the financial information, the purpose of the information should be clear, and the findings effectively communicated. The audit should be performed only when its benefits weigh more than the costs. As a consequence auditors should be aware of the cost of collecting evidence especially in situation were the risk is high. The practice of auditing auditors agree on an attest engagement in which they issue or does issue an examination, a review, or an agreed-upon procedures report on subject matter or an assertion about subject matter that is the responsibility of another party (e.g., management) (Whittington Pany, 2004, p. 2). In an examination of financial statement, referred to as an audit the standards may be the Generally Accepted Accounting Principles (GAAP), and the auditors collect sufficient evidence to attest about how fair is the information in the financial statement respect to the GAAP. However, here are three types of audits: (a) audits of financial statements, (b) compliance audits, and (c) operational audits. Financial audits determine if the statements were prepared according with GAAP. Compliance audit verifies if the company had complies with law, regulations or polices and procedures. Finally, operational audits review the effectiveness and efficiency of particular unit of an organization (Whittington Pany, 2004, p. 11). Relative to the public accounting standards, the American Institute of Certified Public Accountants (AICPA) has developed the framework for the general accepted auditing standards (GAAS), which are the fundamentals principles of independent auditing in the U. S. The framework is divided in three major areas that are summarized as follow: General standards. A professional possessing adequate technical training and proficiency, independent in mental attitude and free from bias and with professional care planning and performing diligently, perform the audit. Standards of field work. The audit should be adequate planned and the staff properly supervised. Auditor should acquire sufficient understanding of the internal control environment to be able to determine the weak areas, and gather sufficient competent evidence to support their conclusions. Standards of reporting. The final report should state if the statements are consistent with GAAP and if necessary indicate those circumstances departing from GAAP, include adequate informative disclosure, and includes the opinion of the auditors about the financial statements. Likewise, the AICPA has issued a series of auditing standards on auditing procedure, auditing and accounting guides, and auditing statements of position, to help auditor in the fulfillment of their responsibility of detecting misstatement (Whittington Pany, 2004, pp. 34-35). Auditing involve a serious processes that expose auditors to a different situations in which they need to exercise professional ethics. Those moral principles and values leading decisions and actions of the profession of auditing are provided by the AICPA in the Code of Professional Conduct, and by the Institute of Internal Auditors (IIA) Code of Ethics. Normally auditors are involved in a decision process of ethical dimension. CPAs decisions during performing their duties can affect thousands of investors and their resources; therefore, they need to measure the implication of their decisions. Additionally, as Whittington and Pany (2004) indicated, what is considered unethical in a particular society is not specifically prohibited (p. 11), giving relevance and support to the need for the establishment of those principles and values in the accounting and auditing profession. The public accounting, as well as the rest of professions, has the following characteristics: (a) their responsibility to serve the public with independence and due care with fairness and free from bias. (b) Involves a complex body of knowledge that includes different authoritative pronouncements of standards and principles governing the profession and the financial reports due to the need of technical competency. (c) Has establishes some standard of admission to the profession that each CPA is required to meet. In addition (d), need public confidence to be successful (Whittington Pany, 2004, pp. 61-62). The AICPA leads public accountants to recognize their responsibility to the public in general, to their clients, and to the profession. The section one of the code of conduct describes the organization and CPAs principles of responsibilities, public interest, integrity, objectivity and independence, due care, and scope and nature of services. The section two depicts the institutes rules that are compounded by the following: independence, integrity and objectivity, general standards, compliance with standards, accounting principles, confidential client information, contingent fees, acts discreditable, advertising and other forms of solicitation, commissions and referral fees, and form of organization and name (Whittington Pany, 2004, pp. 63-83). Similarly, the IIA has their own code of ethics divided in three main sections, an introductory section, principles, and rules of conduct. Their principles apply to the profession and practice of the internal auditing, and include integrity, objectivity confidentiality, and competency. The IIA rules on conduct include integrity, objectivity, confidentiality, and competency (Whittington Pany, 2004, pp. 83-84). The IIA is the organization that provides the standards for the professional practice of internal auditing. As it can be deduced from the previous summaries, both institutes the IACPA and the IIA require high level of self-discipline and commitment to a honorable professional behavior, integrating similar principles of integrity, objectivity, and competence. Their rules differ in the fact that internal auditors perform internally; public accountants attest on the financial statements to the company as outsiders performing professionally to honor the public trust. However, the concept of independence is common to both ramification of auditing because it refers to the ability to maintain and objective and impartial mental attitude (Whittington Pany, 2004, p. 66), and without of conflict of interest. After the previous review of the auditing theory and how CPAs support it with a professional framework that includes principles, ethical codes, and general accepted standards for the auditing practice, the following section depicts a discussion of audit procedures as well as an introduction of important concepts that are fundamental part of the theory of auditing and the auditing practice. The Audit Procedures The ultimate product after the performance of an audit is the issuance of a report indicating if the financial statements audited comply with GAAP. Sufficient evidence must support the audit report and such evidence is gathered and documented by exercising rigorous procedures that, among other important goals, help the auditors in assessing the risk of misstatement. According to Whittington and Pany (2004), audit procedures involve: (a) the understanding of the client, the business, and industry to use it in assessing risks; (b) the understanding of the internal control environment; (c) the design and performance of controls testing to assess how effective the controls are in preventing or detecting material misstatements; and (d) the design and performance of substantive procedures that include analytical procedures, direct testing of transactions and ending balances (pp. 138-139). Because the internal control is the focus of interest for this demonstration, a separate section will discuss it. The substantive procedures include analytical procedures, the testing of transactions, and the testing of the ending balances on the statements. Analytical procedures consist of an analysis and evaluation of the information present in the financial statements, and a review of the relationship between financial and nonfinancial information. The assumption behind the analytical procedures is that the relationship and trend of the financial information is expected to follow the historical data and projections of the business and in contrary situation evidence must be obtained to support the reasonability of the changes (Whittington Pany, 2004, p. 141). Different techniques are use during the analytical procedures. From simple verification of a number to complicated mathematical models, such the comparison of cumulative expenses and revenues with prior years to find significant differences, the use of multiple regression model to estimate revenues by using economic and industry data, and ratio analysis and its comparison with other businesses in the same industry (Whittington Pany, 2004 (p. 141). The testing procedures seek to prove the occurrence and correct recognition of transactions, and prove of existence and misstatements on what the ending balances represent. The substantive testing procedures are performed as an interim mode before year-end, and then after the business year-end. The level of risk established by the auditors during the overall business assessment guides the extent of the substantive audit procedures. The greater the risk of material misstatement the greater the needed extent of substantive procedures (Whittington Pany, 2004, p. 139), but always keeping under evaluation the cost-benefit relation of increasing the procedures to perform. Among the most common test performed in an audit process, Whittington and Pany (2004) summarized the following: Accounting System: Comparison-Agreeing amounts from different internal records. Documentary evidence: Tracing-Establishing the completeness of transaction processing by following a transaction forward through the accounting records. Vouching-Establishing the existence or occurrence of recorded transactions by following a transaction back to supporting documents forms a subsequent processing step. Inspection-Reading or point-by-point review of a document or record (the terms examine, review, read, and scan are used to describe the inspection technique). Reconciliation-Establishing agreement between two sets of independently maintained but related records. Third-party representation: Confirmation and evaluating a response from a debtor, creditor, or other party in reply to a request for information about a particular item affecting the financial statements. Physical evidence: Physical examination-viewing physical evidence of an asset. Observation-viewing a client activity. Computations: Reperformance-repeating a client activity. This may include operations such as footing (providing the total of a vertical column of figures); cross footing (proving the total of a horizontal row of figures); and extending (re-computing by multiplication). Data interrelationships: Analytical procedures-Evaluation of financial information made by a study of expected relationships among financial and nonfinancial data. Client representations: Inquires-questions directed toward appropriate client personnel. According to Whittington and Pany (2004), auditors also collect evidence from some subjective areas such as the accounting estimates, the fair market value measurement and disclosures, and transactions with related parties (pp. 146-148). After the development of audit procedures auditors test for existence or occurrence to search for misstatements and completeness searching for understatement, from transactions start to finish, and they test the accounting system from source documents to journals to ledgers. (Whittington Pany, 2004, p. 195). The audit program includes two main parts, the assessment of the effectiveness of the client internal controls, and substantive testing. Normally the system portion of an audit program is divided by cycle such as revenue, purchasing and payments, production, payroll, investing, and financing (Whittington Pany, 2004, p. 196). Audit Risk The risk concept is use in different disciplines for different purposes. A simple definition of the concept is that: risk is the level of exposure to the chance that some event happens. The event might be beneficial or prejudicial, or might have subsequent implications to other situations or process. Therefore, in business there is a risk of losing money, a risk of fraud, and a risk of misstatement the financial information. As consequence, business and individuals manage risk and the level of exposure to specific risk according to their judgment. The audit process involves the management of risk in different areas with the goal to reduce it to the minimum level possible. Whittington and Pany (2004) introduced some of the risks concepts such as: business risk, the risk associated with a companys survival and profitability (p. 6). Information risk, the risk that the information used to assess business risk is not accurate (p. 6). Audit risk, the risk that the auditors may unknowingly fail to appropriately modify the opinion on financial statements that are materially misstated (p. 35). Inherent risk, the possibility of a material misstatement of an assertion before considering the clients internal control (p.128). Control risk, the risk that a material misstatement will not be prevented or detected on a timely basis by the clients internal control (p. 129) Detection risk, the risk that the auditors will fail to detect the misstatement with their audit procedures (p. 129). Within the audit risk, auditors assess the risk level of occurrence of the different form of misstatement of financial statement, such as errors, fraud, and illegal acts. In measuring audit risk auditors use the following model: AR = IR x CR x DR Where: AR = Audit risk, IR = Inherent risk, CR = Control risk, and DR = Detection risk. (Whittington Pany, 2004, p. 130) Additionally, because the auditors are expose to some legal responsibility and are subject to be sued by any clients stakeholder, they have to take in consideration the reputation of the management, financial strength, and other financial rating to assess the overall risk or engagement risk of the association with that particular business (Whittington Pany, 2004, p. 174). The process of planning the audit involves the understanding of the client and its environment, an overall audit strategy, and the risk assessment of financial statements material misstatement. Therefore, auditors seek to understand the nature of the client and accounting polices, the industry, regulations and external factors affecting the client, the clients objectives, strategies, and related business risk, how the client measure and review performance, and the internal control environment. (Whittington Pany, 2004, pp. 179-180). Consequently, auditors use different sources to obtain the client overall understanding. That includes electronic research tools, visit to different plant or location of the client, and some analytical procedures. (Whittington Pany, 2004, pp. 181-183). A Companys internal control consists of the policies and procedures established to provide reasonable assurance that the objectives of the company will be achieved; including the clients internal control, they could identify areas of strength as well as of weakness. The stronger the internal control, the less testing of financial statement account balances required by the auditors. For any significant account or any phase of financial operation in which controls were weak, the auditors expanded the nature and extent of their tests of the account balance. With the increased reliance on sampling and internal control, professional standards began to emphasize limitations on auditors ability to detect fraud. The profession recognized that audits designed to discover fraud would be too costly. Good internal control and surety bonds were recognized as better fraud protection techniques than audits. (Whittington Pany, 2004, p. 8) The assessment of inherent risk involves considering the likelihood that material misstatement in financial statement will result, and each risk related to the management assertions. At this stage, auditors identify what it is not correct or the significant risk by area and based on that assessment they adjust their approach, modifying the nature, timing, and extent of the audit procedures (Whittington Pany, 2004, pp. 188-189). Audit Evidence Evidence is all data and information gathered by the auditors to support auditors conclusions. The importance of the evidence is that audit risk is reduced by gathering audit evidence (Whittington Pany, 2004, p. 127) and when the risk is high more evidence is necessary as well as the increasing the coverage of audit procedures. According to Whittington and Pany (2004), evidence need to be collected for each financial statement assertion sufficiently to support their opinion. As issued in the Statement of Auditing Standard (SAS) 31 about evidential matter, the financial statement assertions are the following: Existence or occurrence-assets, liabilities, and owners equity reflected in the financial statements exist; the recorded transactions have occurred. Completeness-all transactions, assets, liabilities, and owners equity that should be presented in the financial statements are included. Rights and obligations-the client has rights to assets and obligation to pay liabilities that are included in the financial statements. Valuation or allocation-assets, liabilities, owners equity, revenues, and expenses are presented at amounts that are determined in accordance with generally accepted accounting principles. Presentation and disclosure-accounts are described and classified in the financial statements in accordance with generally accepted accounting principles, and all material disclosures are provides. (Whittington Pany, 2004, p. 174) The above assertions are the base for the risk assessment performed by auditors, and to determine misstatements possible to occur and consequently decide the audit procedure to exercise. Guidelines are included in the SAS 31 regarding what sufficient competent evidence is, which relates to the quantity of evidence auditors should collect. The competence of the evidence is determined by the combined condition of relevant and valid. That means that it most related to the assertion, and that it is dependent on the circumstance in which it is obtained. The reliability or validity of the evidence increase when is received from independent sources, when is produced by an effective internal control, gathered directly by the auditor, is documented, obtained from original documents, and when is received from more than one source (Whittington Pany, 2004, p. 132). Different types of audit evidence is obtained by the auditors such as accounting information system, internal and external documentary evidence, third-party representations such as confirmations, reports, and lawyers letters; physical evidence such as fixed assets and inventory, computations re-performance, data interrelationships of financial and nonfinancial information, and client representations oral and in writing (Whittington Pany, 2004, pp. 131-137). An important supporting evidence of the audit report and conclusions is the audit documentation, which is required by the SAS 96 for the auditors understanding and review of the audit work, the nature of audit work performed, and to show the agreement between the records and the financial statements. The working papers have some important functions: (a) are the best way to assign and coordinate the auditing work, (b) help audit managers and partners in the supervision and reviewing or the work of assistants, (c) support the audit reports, (d) documents the auditors compliance with GAAS, and (d) assist in the conduction of future audit to the client (Whittington Pany, 2004, pp. 148-150). The working papers are confidential and unrestricted documentation owned by the auditors, principally because they represent the major factor to use in case of negligence charges. Part of the working paper are the administrative working papers, the working trial balance, separate schedules, adjusting journal entries and supporting schedules, and analysis of ledgers accounts such as a reconciliation, computational working paper, corroborating documents. They are filed in two major groups, permanent file, and current files (Whittington Pany, 2004, pp. 151-158). Audit Sampling As a large-scale corporate grow rapidly auditors began to sample selected transactions, rather than study all transactions. Auditors and business managers gradually came to accept the proposition that careful examination of relatively few selected transactions would give a cost-effective, reliable indication of the accuracy of other similar transactions (Whittington Pany, 2004, p. 8). As explained before, auditors need sufficient and competent evidence to support their conclusions, but because business grows involving high volume of economic events and transactions, they need to rely in sampling testing. Audit sampling can be statistical or no statistical, involves the selection of a sample from a group of items and the use of the sample characteristics presuming that the auditors can draw inferences about the whole population. (Whittington Pany, 2004, p. 309). From the previous sampling introduction, we have the sample risk that is the risk that the auditors conclusion based on a sample might be different if they examine the whole population. According to Whittington and Pany (2004) sampling risk is reduced by increasing the size of the sample (p. 309) or by auditing the whole population. Auditors use statistical and no statistical sampling to perform a random selection, which involve that every item in the population has an equal chance of being selected for inclusion in the sample. Different techniques are used such as random number tables, random number generators, systematic selection, haphazard selection, block selection, and stratification (Whittington Pany, 2004, pp. 310-313). There is a sample risk for test of controls in which auditors face the risk of assessing control risk too high, which is related to efficiency, or too low based on the operating effectiveness of the control. The AICAP guide suggest the statistical sample sizes for tests of controls at 5 percent risk of assessing control risk too low, providing the following tolerable deviation rate per assessed level of control risk: for low 2 7%, for moderate 6 12 %, for slightly below the maximum 11 20%, and for maximum level of control risk they recommend to omit test (Whittington Pany, 2004, pp. 316-320). Besides sampling, auditors became aware of the importance of effective internal auditing. Following section presents a discussion about internal auditing. Internal Auditing The internal auditing developed rapidly during the decade of 1930s generating the foundation of the Institute of Internal Auditors (IIA), which is an organization with local chapter in the main cities worldwide. The IIA defines internal adducting as follows: An independent, objective assurance and consulting activity designed to add value and improve an organizations operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance process. (The Institute of Internal Auditors [IIA], 2008) Internal auditors are an important part of the internal control environment of entities, representing the highest level of control that measure and evaluate the effectiveness of other controls. Additionally to the financial controls, the internal auditors scope includes the evaluation and testing of control effectiveness, and other assurance and consulting services to the management. Some companies have focus on outsourcing the internal audit functions, which is also provided by CPA firms as an extended audit service and according to the AICPA guiding. However, opposition to the participation of accounting firms exist under the argument of possible conflicts of interest having then as part of the internal control when they also audit the company. The IIA have issued the standards for the practice of internal auditing with the following purpose: To delineate basic principles that represent the practice of internal auditing. Provide a framework for performing and promoting a broad range of value-added internal auditing. Establish the basis for the evaluation of internal audit performance. To foster improved organizational processes and operations. The auditing standards of the IIA includes two parts, the first is the attribute standards that state basic requirements for the practice of internal auditing. According with this attribute, organizations should define in a formal document or internal audit charter, the purpose, authority, and responsibility of the internal audit, and the nature of assurance and consulting services that the internal auditors will provide. Additionally, the chapter should include recognition of the definition of internal auditing, the code of ethics, and the auditing standards (IIA, 2008). The standards also state the independence and objectivity condition for internal auditors during the performance of their work. The need of freedom from conditions, bias, and subordination of judgment, or conflict of interest that impairs their ability to perform objectively, is rigorously presented in the standards. Additionally, the competencies, knowledge, and skills that an auditor must possess are described as well as the due professional care requirement for the performance of the engagement as important elements of the IIA standards. Finally, the attribute standards set requirements for continuing professional development and quality assurance for the internal audit activity (IIA, 2008). The second part of the IIA standards covers the Concepts and Theories of Auditing Concepts and Theories of Auditing Auditing has been present for years in different stage of development following the evolution of accounting. Starting since the epoch when the records were approved after a public reading, to the era when governments officials were measured by their honesty. Followed by the times of the industrial revolution were the ownership of companies started separating from management; when owners required more protection of their investments increasing the use of auditors, consequently; to the times were an auditor was always searching for frauds or errors (Whittington Pany, 2004, p. 7) and then to ascertain the actual financial condition and earnings of an enterprise (Montgomery, 1913, p. 9). However, the acceptance of auditing as an academic discipline is not old and just after the development of different concepts and techniques within the audit model such as the use of sampling, the study of the internal control environment, and the risk assessment, is when more focus to the theoretical and conceptual framework of auditing it is been devoted. Andrew Sayer (1992) discussed the concept of theories in social science from the perspective of theory as an ordering-framework (p. 50), indicating that theory allows the use of the observed data and their relationships to predict and explain empirical events. Additionally Cooper and Schindler (1998) define theory as a set of systematically interrelated concepts, definitions, and propositions that are advanced to explain and predict phenomena (facts) (p. 47). Another concept is expressed by Singleton and Straits (2005) explaining theory as a set of interconnected propositions (p. 19). The success in the explanations or predictions of any phenomena depends on the level that the theory holds and do not fails fitting in the situation, and the challenge is to perfect the process of matching theory and fact (Cooper and Schindler (1998). Different authors have started the development of the audit theory such as Mautz and Sharaf (1961) with their publication titled The Philosophy of Auditing; also Tom Lee (1986) with his approach in the book Company Auditing, and later David Flint (1988) with his book Philosophy and principles of auditing (as cited in Moizer, 1989). The auditing analysis in this demonstration will be framed on the postulates proposed by David Flint (1988) as a foundation for the theory of auditing. Flint (1988) stated that there is a matter of public accountability demanding an independent audit for its demonstration with clear definition and intention, based on evidence that only skilled auditors gather, measure it, and compare it against the standards, which generates economic or social benefit (as cited in Moizer, 1989). Following are the seven postulates or assumptions stated by Flint (1988): There is a relationship of accountability or a situation of public accountability. Accountability cannot be demonstrated without an audit. An audit requires independence and freedom. The subject matter of audit is susceptible to verification by evidence. Auditors are skilled judges who are able to measure and compare actual performance against standards of accountability. The meaning, significance, and intention of statements to be audited must be clear. An audit produces an economic or social benefit. (Flink, 1989) Whenever an economic relationship exists one of the parties owe a duty of an acceptable accountability, consequently audits are voluntary, imposed for the health of the relationship. There are also audit related to the interest of the public in matters of the society institutions. As expressed by Whittington and Pany (2004) dependable information is essential to the very existence of our society (p. 1). They explained the social need for audit and professionals who can attest that the reported information is fair respect to the reality for purpose of allocating resources for the production of services and goods based on reliable financial information (p. 1). Normally the financial and economic aspects of the related subject matter are complex, not physically accessible, or have the level of significance that necessary demand an audit to accept the accountability. No all investors or stakeholders of an entity understand the complexity of the business and financial environment, or are near to the place were their resources are to oversee for accountability. The credibility of the information is important and the preferable form of obtaining credible information to rely on is by using independent auditors to perform an audit. That reduce the business risk that relates to the permanence and profits of the company, and the information risk that the financial information used to make a decision is materially misstated (Whittington Pany, 2004, p. 6). Therefore, if the audit must add credibility it must be performed independently and without bias or prejudice. Audit is subject to verification and that is possible only if sufficient evidential matter of the audit is gathered. Additionally, some standards of accountability and performance need to be in place to easy the auditors measurement. Therefore, the parties involved must agree on their acceptable standards. The auditing community has set some professional guidance as a form of general accepted practiced standards. For an audit to add value to the financial information, the purpose of the information should be clear, and the findings effectively communicated. The audit should be performed only when its benefits weigh more than the costs. As a consequence auditors should be aware of the cost of collecting evidence especially in situation were the risk is high. The practice of auditing auditors agree on an attest engagement in which they issue or does issue an examination, a review, or an agreed-upon procedures report on subject matter or an assertion about subject matter that is the responsibility of another party (e.g., management) (Whittington Pany, 2004, p. 2). In an examination of financial statement, referred to as an audit the standards may be the Generally Accepted Accounting Principles (GAAP), and the auditors collect sufficient evidence to attest about how fair is the information in the financial statement respect to the GAAP. However, here are three types of audits: (a) audits of financial statements, (b) compliance audits, and (c) operational audits. Financial audits determine if the statements were prepared according with GAAP. Compliance audit verifies if the company had complies with law, regulations or polices and procedures. Finally, operational audits review the effectiveness and efficiency of particular unit of an organization (Whittington Pany, 2004, p. 11). Relative to the public accounting standards, the American Institute of Certified Public Accountants (AICPA) has developed the framework for the general accepted auditing standards (GAAS), which are the fundamentals principles of independent auditing in the U. S. The framework is divided in three major areas that are summarized as follow: General standards. A professional possessing adequate technical training and proficiency, independent in mental attitude and free from bias and with professional care planning and performing diligently, perform the audit. Standards of field work. The audit should be adequate planned and the staff properly supervised. Auditor should acquire sufficient understanding of the internal control environment to be able to determine the weak areas, and gather sufficient competent evidence to support their conclusions. Standards of reporting. The final report should state if the statements are consistent with GAAP and if necessary indicate those circumstances departing from GAAP, include adequate informative disclosure, and includes the opinion of the auditors about the financial statements. Likewise, the AICPA has issued a series of auditing standards on auditing procedure, auditing and accounting guides, and auditing statements of position, to help auditor in the fulfillment of their responsibility of detecting misstatement (Whittington Pany, 2004, pp. 34-35). Auditing involve a serious processes that expose auditors to a different situations in which they need to exercise professional ethics. Those moral principles and values leading decisions and actions of the profession of auditing are provided by the AICPA in the Code of Professional Conduct, and by the Institute of Internal Auditors (IIA) Code of Ethics. Normally auditors are involved in a decision process of ethical dimension. CPAs decisions during performing their duties can affect thousands of investors and their resources; therefore, they need to measure the implication of their decisions. Additionally, as Whittington and Pany (2004) indicated, what is considered unethical in a particular society is not specifically prohibited (p. 11), giving relevance and support to the need for the establishment of those principles and values in the accounting and auditing profession. The public accounting, as well as the rest of professions, has the following characteristics: (a) their responsibility to serve the public with independence and due care with fairness and free from bias. (b) Involves a complex body of knowledge that includes different authoritative pronouncements of standards and principles governing the profession and the financial reports due to the need of technical competency. (c) Has establishes some standard of admission to the profession that each CPA is required to meet. In addition (d), need public confidence to be successful (Whittington Pany, 2004, pp. 61-62). The AICPA leads public accountants to recognize their responsibility to the public in general, to their clients, and to the profession. The section one of the code of conduct describes the organization and CPAs principles of responsibilities, public interest, integrity, objectivity and independence, due care, and scope and nature of services. The section two depicts the institutes rules that are compounded by the following: independence, integrity and objectivity, general standards, compliance with standards, accounting principles, confidential client information, contingent fees, acts discreditable, advertising and other forms of solicitation, commissions and referral fees, and form of organization and name (Whittington Pany, 2004, pp. 63-83). Similarly, the IIA has their own code of ethics divided in three main sections, an introductory section, principles, and rules of conduct. Their principles apply to the profession and practice of the internal auditing, and include integrity, objectivity confidentiality, and competency. The IIA rules on conduct include integrity, objectivity, confidentiality, and competency (Whittington Pany, 2004, pp. 83-84). The IIA is the organization that provides the standards for the professional practice of internal auditing. As it can be deduced from the previous summaries, both institutes the IACPA and the IIA require high level of self-discipline and commitment to a honorable professional behavior, integrating similar principles of integrity, objectivity, and competence. Their rules differ in the fact that internal auditors perform internally; public accountants attest on the financial statements to the company as outsiders performing professionally to honor the public trust. However, the concept of independence is common to both ramification of auditing because it refers to the ability to maintain and objective and impartial mental attitude (Whittington Pany, 2004, p. 66), and without of conflict of interest. After the previous review of the auditing theory and how CPAs support it with a professional framework that includes principles, ethical codes, and general accepted standards for the auditing practice, the following section depicts a discussion of audit procedures as well as an introduction of important concepts that are fundamental part of the theory of auditing and the auditing practice. The Audit Procedures The ultimate product after the performance of an audit is the issuance of a report indicating if the financial statements audited comply with GAAP. Sufficient evidence must support the audit report and such evidence is gathered and documented by exercising rigorous procedures that, among other important goals, help the auditors in assessing the risk of misstatement. According to Whittington and Pany (2004), audit procedures involve: (a) the understanding of the client, the business, and industry to use it in assessing risks; (b) the understanding of the internal control environment; (c) the design and performance of controls testing to assess how effective the controls are in preventing or detecting material misstatements; and (d) the design and performance of substantive procedures that include analytical procedures, direct testing of transactions and ending balances (pp. 138-139). Because the internal control is the focus of interest for this demonstration, a separate section will discuss it. The substantive procedures include analytical procedures, the testing of transactions, and the testing of the ending balances on the statements. Analytical procedures consist of an analysis and evaluation of the information present in the financial statements, and a review of the relationship between financial and nonfinancial information. The assumption behind the analytical procedures is that the relationship and trend of the financial information is expected to follow the historical data and projections of the business and in contrary situation evidence must be obtained to support the reasonability of the changes (Whittington Pany, 2004, p. 141). Different techniques are use during the analytical procedures. From simple verification of a number to complicated mathematical models, such the comparison of cumulative expenses and revenues with prior years to find significant differences, the use of multiple regression model to estimate revenues by using economic and industry data, and ratio analysis and its comparison with other businesses in the same industry (Whittington Pany, 2004 (p. 141). The testing procedures seek to prove the occurrence and correct recognition of transactions, and prove of existence and misstatements on what the ending balances represent. The substantive testing procedures are performed as an interim mode before year-end, and then after the business year-end. The level of risk established by the auditors during the overall business assessment guides the extent of the substantive audit procedures. The greater the risk of material misstatement the greater the needed extent of substantive procedures (Whittington Pany, 2004, p. 139), but always keeping under evaluation the cost-benefit relation of increasing the procedures to perform. Among the most common test performed in an audit process, Whittington and Pany (2004) summarized the following: Accounting System: Comparison-Agreeing amounts from different internal records. Documentary evidence: Tracing-Establishing the completeness of transaction processing by following a transaction forward through the accounting records. Vouching-Establishing the existence or occurrence of recorded transactions by following a transaction back to supporting documents forms a subsequent processing step. Inspection-Reading or point-by-point review of a document or record (the terms examine, review, read, and scan are used to describe the inspection technique). Reconciliation-Establishing agreement between two sets of independently maintained but related records. Third-party representation: Confirmation and evaluating a response from a debtor, creditor, or other party in reply to a request for information about a particular item affecting the financial statements. Physical evidence: Physical examination-viewing physical evidence of an asset. Observation-viewing a client activity. Computations: Reperformance-repeating a client activity. This may include operations such as footing (providing the total of a vertical column of figures); cross footing (proving the total of a horizontal row of figures); and extending (re-computing by multiplication). Data interrelationships: Analytical procedures-Evaluation of financial information made by a study of expected relationships among financial and nonfinancial data. Client representations: Inquires-questions directed toward appropriate client personnel. According to Whittington and Pany (2004), auditors also collect evidence from some subjective areas such as the accounting estimates, the fair market value measurement and disclosures, and transactions with related parties (pp. 146-148). After the development of audit procedures auditors test for existence or occurrence to search for misstatements and completeness searching for understatement, from transactions start to finish, and they test the accounting system from source documents to journals to ledgers. (Whittington Pany, 2004, p. 195). The audit program includes two main parts, the assessment of the effectiveness of the client internal controls, and substantive testing. Normally the system portion of an audit program is divided by cycle such as revenue, purchasing and payments, production, payroll, investing, and financing (Whittington Pany, 2004, p. 196). Audit Risk The risk concept is use in different disciplines for different purposes. A simple definition of the concept is that: risk is the level of exposure to the chance that some event happens. The event might be beneficial or prejudicial, or might have subsequent implications to other situations or process. Therefore, in business there is a risk of losing money, a risk of fraud, and a risk of misstatement the financial information. As consequence, business and individuals manage risk and the level of exposure to specific risk according to their judgment. The audit process involves the management of risk in different areas with the goal to reduce it to the minimum level possible. Whittington and Pany (2004) introduced some of the risks concepts such as: business risk, the risk associated with a companys survival and profitability (p. 6). Information risk, the risk that the information used to assess business risk is not accurate (p. 6). Audit risk, the risk that the auditors may unknowingly fail to appropriately modify the opinion on financial statements that are materially misstated (p. 35). Inherent risk, the possibility of a material misstatement of an assertion before considering the clients internal control (p.128). Control risk, the risk that a material misstatement will not be prevented or detected on a timely basis by the clients internal control (p. 129) Detection risk, the risk that the auditors will fail to detect the misstatement with their audit procedures (p. 129). Within the audit risk, auditors assess the risk level of occurrence of the different form of misstatement of financial statement, such as errors, fraud, and illegal acts. In measuring audit risk auditors use the following model: AR = IR x CR x DR Where: AR = Audit risk, IR = Inherent risk, CR = Control risk, and DR = Detection risk. (Whittington Pany, 2004, p. 130) Additionally, because the auditors are expose to some legal responsibility and are subject to be sued by any clients stakeholder, they have to take in consideration the reputation of the management, financial strength, and other financial rating to assess the overall risk or engagement risk of the association with that particular business (Whittington Pany, 2004, p. 174). The process of planning the audit involves the understanding of the client and its environment, an overall audit strategy, and the risk assessment of financial statements material misstatement. Therefore, auditors seek to understand the nature of the client and accounting polices, the industry, regulations and external factors affecting the client, the clients objectives, strategies, and related business risk, how the client measure and review performance, and the internal control environment. (Whittington Pany, 2004, pp. 179-180). Consequently, auditors use different sources to obtain the client overall understanding. That includes electronic research tools, visit to different plant or location of the client, and some analytical procedures. (Whittington Pany, 2004, pp. 181-183). A Companys internal control consists of the policies and procedures established to provide reasonable assurance that the objectives of the company will be achieved; including the clients internal control, they could identify areas of strength as well as of weakness. The stronger the internal control, the less testing of financial statement account balances required by the auditors. For any significant account or any phase of financial operation in which controls were weak, the auditors expanded the nature and extent of their tests of the account balance. With the increased reliance on sampling and internal control, professional standards began to emphasize limitations on auditors ability to detect fraud. The profession recognized that audits designed to discover fraud would be too costly. Good internal control and surety bonds were recognized as better fraud protection techniques than audits. (Whittington Pany, 2004, p. 8) The assessment of inherent risk involves considering the likelihood that material misstatement in financial statement will result, and each risk related to the management assertions. At this stage, auditors identify what it is not correct or the significant risk by area and based on that assessment they adjust their approach, modifying the nature, timing, and extent of the audit procedures (Whittington Pany, 2004, pp. 188-189). Audit Evidence Evidence is all data and information gathered by the auditors to support auditors conclusions. The importance of the evidence is that audit risk is reduced by gathering audit evidence (Whittington Pany, 2004, p. 127) and when the risk is high more evidence is necessary as well as the increasing the coverage of audit procedures. According to Whittington and Pany (2004), evidence need to be collected for each financial statement assertion sufficiently to support their opinion. As issued in the Statement of Auditing Standard (SAS) 31 about evidential matter, the financial statement assertions are the following: Existence or occurrence-assets, liabilities, and owners equity reflected in the financial statements exist; the recorded transactions have occurred. Completeness-all transactions, assets, liabilities, and owners equity that should be presented in the financial statements are included. Rights and obligations-the client has rights to assets and obligation to pay liabilities that are included in the financial statements. Valuation or allocation-assets, liabilities, owners equity, revenues, and expenses are presented at amounts that are determined in accordance with generally accepted accounting principles. Presentation and disclosure-accounts are described and classified in the financial statements in accordance with generally accepted accounting principles, and all material disclosures are provides. (Whittington Pany, 2004, p. 174) The above assertions are the base for the risk assessment performed by auditors, and to determine misstatements possible to occur and consequently decide the audit procedure to exercise. Guidelines are included in the SAS 31 regarding what sufficient competent evidence is, which relates to the quantity of evidence auditors should collect. The competence of the evidence is determined by the combined condition of relevant and valid. That means that it most related to the assertion, and that it is dependent on the circumstance in which it is obtained. The reliability or validity of the evidence increase when is received from independent sources, when is produced by an effective internal control, gathered directly by the auditor, is documented, obtained from original documents, and when is received from more than one source (Whittington Pany, 2004, p. 132). Different types of audit evidence is obtained by the auditors such as accounting information system, internal and external documentary evidence, third-party representations such as confirmations, reports, and lawyers letters; physical evidence such as fixed assets and inventory, computations re-performance, data interrelationships of financial and nonfinancial information, and client representations oral and in writing (Whittington Pany, 2004, pp. 131-137). An important supporting evidence of the audit report and conclusions is the audit documentation, which is required by the SAS 96 for the auditors understanding and review of the audit work, the nature of audit work performed, and to show the agreement between the records and the financial statements. The working papers have some important functions: (a) are the best way to assign and coordinate the auditing work, (b) help audit managers and partners in the supervision and reviewing or the work of assistants, (c) support the audit reports, (d) documents the auditors compliance with GAAS, and (d) assist in the conduction of future audit to the client (Whittington Pany, 2004, pp. 148-150). The working papers are confidential and unrestricted documentation owned by the auditors, principally because they represent the major factor to use in case of negligence charges. Part of the working paper are the administrative working papers, the working trial balance, separate schedules, adjusting journal entries and supporting schedules, and analysis of ledgers accounts such as a reconciliation, computational working paper, corroborating documents. They are filed in two major groups, permanent file, and current files (Whittington Pany, 2004, pp. 151-158). Audit Sampling As a large-scale corporate grow rapidly auditors began to sample selected transactions, rather than study all transactions. Auditors and business managers gradually came to accept the proposition that careful examination of relatively few selected transactions would give a cost-effective, reliable indication of the accuracy of other similar transactions (Whittington Pany, 2004, p. 8). As explained before, auditors need sufficient and competent evidence to support their conclusions, but because business grows involving high volume of economic events and transactions, they need to rely in sampling testing. Audit sampling can be statistical or no statistical, involves the selection of a sample from a group of items and the use of the sample characteristics presuming that the auditors can draw inferences about the whole population. (Whittington Pany, 2004, p. 309). From the previous sampling introduction, we have the sample risk that is the risk that the auditors conclusion based on a sample might be different if they examine the whole population. According to Whittington and Pany (2004) sampling risk is reduced by increasing the size of the sample (p. 309) or by auditing the whole population. Auditors use statistical and no statistical sampling to perform a random selection, which involve that every item in the population has an equal chance of being selected for inclusion in the sample. Different techniques are used such as random number tables, random number generators, systematic selection, haphazard selection, block selection, and stratification (Whittington Pany, 2004, pp. 310-313). There is a sample risk for test of controls in which auditors face the risk of assessing control risk too high, which is related to efficiency, or too low based on the operating effectiveness of the control. The AICAP guide suggest the statistical sample sizes for tests of controls at 5 percent risk of assessing control risk too low, providing the following tolerable deviation rate per assessed level of control risk: for low 2 7%, for moderate 6 12 %, for slightly below the maximum 11 20%, and for maximum level of control risk they recommend to omit test (Whittington Pany, 2004, pp. 316-320). Besides sampling, auditors became aware of the importance of effective internal auditing. Following section presents a discussion about internal auditing. Internal Auditing The internal auditing developed rapidly during the decade of 1930s generating the foundation of the Institute of Internal Auditors (IIA), which is an organization with local chapter in the main cities worldwide. The IIA defines internal adducting as follows: An independent, objective assurance and consulting activity designed to add value and improve an organizations operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance process. (The Institute of Internal Auditors [IIA], 2008) Internal auditors are an important part of the internal control environment of entities, representing the highest level of control that measure and evaluate the effectiveness of other controls. Additionally to the financial controls, the internal auditors scope includes the evaluation and testing of control effectiveness, and other assurance and consulting services to the management. Some companies have focus on outsourcing the internal audit functions, which is also provided by CPA firms as an extended audit service and according to the AICPA guiding. However, opposition to the participation of accounting firms exist under the argument of possible conflicts of interest having then as part of the internal control when they also audit the company. The IIA have issued the standards for the practice of internal auditing with the following purpose: To delineate basic principles that represent the practice of internal auditing. Provide a framework for performing and promoting a broad range of value-added internal auditing. Establish the basis for the evaluation of internal audit performance. To foster improved organizational processes and operations. The auditing standards of the IIA includes two parts, the first is the attribute standards that state basic requirements for the practice of internal auditing. According with this attribute, organizations should define in a formal document or internal audit charter, the purpose, authority, and responsibility of the internal audit, and the nature of assurance and consulting services that the internal auditors will provide. Additionally, the chapter should include recognition of the definition of internal auditing, the code of ethics, and the auditing standards (IIA, 2008). The standards also state the independence and objectivity condition for internal auditors during the performance of their work. The need of freedom from conditions, bias, and subordination of judgment, or conflict of interest that impairs their ability to perform objectively, is rigorously presented in the standards. Additionally, the competencies, knowledge, and skills that an auditor must possess are described as well as the due professional care requirement for the performance of the engagement as important elements of the IIA standards. Finally, the attribute standards set requirements for continuing professional development and quality assurance for the internal audit activity (IIA, 2008). The second part of the IIA standards covers the