How Economic events occur around us every day, and aims to provide Assignment

How Economic events occur around us every day, and aims to provide association between what you learn from economic models and concepts in class with real-life events happening around you - Assignment Example unfortunate that politicians and Ideologues on both sides of the spectrum are majorly interested in quick fixes rather that the actual ground work of fixing the nation’s economy. During the past few years, the economy of the United States of America has faced major challenges. As the nation’s economy continue to spatter, research and studies have identified multiples areas that is really deteriorating the American Economy. The sum total of the federal government taxes currently stands at 18 percent of the GDP. The local and state taxes have however increased substantially over this period. The total taxes from all the sources are a round 34 percent which is higher that 26 percent in the mid-50s, but slightly lower than 36 percent reached over the past 15 years. Over year the years most developed countries have lowered their corporate taxes leaving the United State of America to be among the developed countries that still has high rate of corporate taxation (Michael, 2012). This measure discourages investment in the country, which in turn reduces wages and holds production. America business faces serious challenges in taxes. Most market in the American Economy fall between demand and supply extremes and the incidence of taxation is shared by both the consumer and producer in proportional that varies. Most American population, who are majority of consumers pay more tax than producers thus resulting into a general high taxation. The e area paid by paid by the consumer corresponds to the general change in equilibrium price. The remainder of the price which is the difference between cost of production and the new price of that commodity, is paid by the producer. The internal revenue service estimated that in 2002 the United States of America Tax gap was 345 billion. The tax gap is the difference between the amount actually collected and the amount of tax legally owed by the government. In 2006 the tax gap was estimated to be about $450 billion. Two years later it

The Role of External Auditors in Accounting Assignment

The Role of External Auditors in Accounting - Assignment Example In most cases, a fraudulent act exists when one or more auditors approve inaccurate accounting on behalf of a company for the reason of tax evasion or to strategically register for an Initial Public Offering (IPO). To prevent moral hazards associated with the auditors’ liability, the British Serious Fraud Office has imposed heavy penalties for swindlers and white-collar criminals to shut down or suspend a suspicious business (Country Updates, 1997). On the other hand, auditors who are found guilty of professional negligence may end up facing a monetary loss or penalty through punitive fines and/or the confiscation of their license to practice auditing in the United Kingdom. As stated by Michael Power of London School of Economics, â€Å"it may not be reasonable to expect that auditors would be challenging business models directly and raising strategic issues with finance directors, that is not their job and if we want it to be their job then things would have to change quite substantially †¦ The direction of my comment is that we might be expecting too much from this black box [External Audit] in terms of what it actually delivers† (Priddy, 2011, p. 59). In response to the statement made by Power, this report will first discuss the role and responsibilities of external auditors followed by providing a brief overview with regards to the corporate governance. In line with this, there is a strong need to go through business theories and concepts that will enable the readers to have a better understanding of how businesses in a corporate world function. Based on the individual roles and responsibilities of shareholders, internal and external auditors, the board of directors, and the CEO, this report will explain the limits in the role and responsibilities of external auditors when it comes to detecting and controlling fraud activities in business.