ASSIGNMENT INSTRUCTIONS/ QUESTIONS The CPA Australia section on Moodle contains a number of media links http://www.abc.net.au/news/...

CPA Australia--- lack in governance
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Title
Name of student
Name of professor
Name of course
Date submitted
CPA Australia--- lack in governance
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Table of Contents:
Executive Summary......................................................................................3
Introduction..................................................................................................3
Discussion and analysis.................................................................................4
Conclusion.....................................................................................................8
References.....................................................................................................10
CPA Australia--- lack in governance
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Executive summary:
Corporate Governance is one of the most desirous ways in which firms both for profit
and non profit function. Organizations which are guided by governance charters are
said to be ethical in functioning. CPA Australia a premier standard setter in accounting
profession fell prey to personal designs of the CEO .This paper deals with how
standards and regulations have to be tightened up to prevent such happenings in
future .
Introduction
The recent controversy su
ounding CPA Australia revolves around members
equesting information on use of its funds, payment of high fees to top management,
use of funds for a loss-making venture and sources of its revenue. CPA members had
equested information on salaries of its top officers for months before it was divulged.
The extent of losses of a start-up to accredit independent financial advisors had also
een set-up was also revealed.
Being a non-profit organisation, a key issue remains as to whether major
performance-based incentives should be provided to top management and whether a
large surplus in funds indicates over-charging of its members rather than successful
corporate strategy. Another is to what extent it should sustain losses from
underperformance of the start-up venture. Surplus was also spent on what may be
characterised as personal expenses of the chief executive officer, which included
marketing a chat show and a book written by him.
The key underlying governance issues were inadequate information being provided to
members, and lack of proper checks and balances (for member involvement) in key
CPA Australia--- lack in governance
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decision making processes. While all the required information was shared with
members, it is claimed that it was obtained with great difficulty. An independent
examination was set-up to review the management of the organisation, while observers
and members commented on collection of enrolment fees, a chief source of revenue.
This
ings up the question of the extent to which independent review (by government
egulation and/or a greater supervision of management by members) would be required
for a leading body such as CPA in its operations and whether levy of such large fees,
and maintenance of high enrolment standards, with a candidate failure rate of between
27% and 56% in 2016 (Hobday, 2017), are justified.
Discussion and analysis:
The most important discussion in this case is regarding ethical standards which were
violated very blatantly with least concern for its repercussions in the accounting
standards procedures and disclosers and the role of Directors in
inging in ethical
practices of good governance.
CPA Australia typically suffers from lack of accountability in working. CPA
Australia was considered to be highly illustrious with its working regulation till a
whistleblower blew the co
upt practices at CPA Australia. CPA Australia was not
a public listed company hence was not governed by the Corporations act. Yet its
illustrious work in governance cannot be denied .It is interesting to note that the ASX
Code of Corporate Governance was which is cu
ently in practice by the Australian
stock exchange was written by CPA Australia .Having understood corporate
governance so well it was quite shocking to note that there was a whole case of blatant
scandal in its governance issues.
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The top accounting body CPA Australia was faced with no financial clarity. Being the
primary accounting body its job is to enforce accounting regulation to bodies in
Australia who...