Please select any three cases from the Harvard course pack for this course, summarize those three cases, and discuss what common themes you can identify amongst those three cases. Please submit a Word...

Case 1: Accounting for the iPhone at Apple Inc.
The case revolves around Apple Incorporation and how company has accounted for the
evenues for iPhone’s. While reporting the results of Q4 of FY2008, company reported results in
oth GAAP and non-GAAP methods. The results under non-GAAP methods were stunning and
the primary reason behind is the fact that it reduced the impact of subscription accounting.
According to Steve Jobs, subscription accounting was spreading the impact of iPhone across two
years and it was not a true reflection of the kind of performance achieved by the company during
that period. This didn’t matter much till the iPhone business was small compared to Mac and
music business. However when the iPhone business started growing the impact would be huge
on Apple’s financial reporting. The iPhone business model actually follows a subscription
usiness model, whereby the plans are clu
ed with the Telecom service provider. This is the
eason the whole business is based on subscription (Jobs an unconventional leader, 2017). The
iPhone model was clu
ed with AT&T and hence the revenue was spread over two years which
was subscription. Under the method of subscription accounting, the revenue is recognized when
the cash is received from the transaction. Since in this case cash is received every month, hence
evenue was recognized every month and distributed over the life of the iPhone. This is primarily
the reason in under reporting of the revenues and investor were not getting the right perception
about the performance of the company. Under the non-GAAP measure the same is not the
method. It is as per the sale period where the recognition happens. The problem with the non-
GAAP measure is the fact that costs associated with the upgrade and launch of new features is
not accounted for in the expense. IT financial management is a fundamental business governance
discipline that is often complicated by poorly configured tools and processes. Miscategorized
spending fails to show what the money buys in the general ledger. Not every digital technology
is bought using the IT budget, so this isn't simply an issue of IT governance, it's a matter of
corporate governance and transparency for investors (Managing Client Conflicts, 2005).
This case study sets out simple improvements that have helped chief information officers
(CIOs), chief financial officers (CFOs) and chief procurement officers (CPOs) to standardize the
management of digital technology costs throughout all related disciplines, from enterprise
architecture, project and service management through procurement, asset and vendor
management. Budget holders who are reluctant planners often complain that categorization
educes their flexibility and agility. In our experience the reverse is true. The problem with
udgeting at too high a level is that it results in a high margin of e
or and budget variance.
Clients have found that the discipline of categorizing spending reduces the risk of inaccurate
assumptions, which include but are not limited to capitalization or taxation. Misunderstandings
cause budget shortfalls. Spending is often described as a "cash flow" view. Take the example of
clients that are generally required to budget for salaries in full (Leadership Traits of Steve Jobs,
2017). Apple follows this convention by not including any capitalization of personnel costs in
their IT key metrics. Categories not only align appropriate accounting treatments, they start to
identify what the organization is getting in return for its spending. Categories help to classify
spending by run, grow or transform as a universal prioritization framework. Successful
organizations spend more than the industry average on innovation and growth but several times
more than industry laggards. Spending categories are typically required to support the chart of
accounts, align with tax categories and make it easier to track and manage cash outflows. For
example, the U.K. government has 49 different information technology codes in its standard
chart of accounts to ensure their co
ect accounting treatment (Jobs an unconventional leader,
2017).
Case 2: The...