Wednesday, November 13, 2013

Fannie Mae: What's The Damage?

PROBLEM: After reviewing the facts of the article, it appears that Fannie Mae has an accounting system problem, which whitethorn be collect to malapropos management decisions and lax internal controls of these decisions and practices. ALTERNATIVE #1: The first utility(a) in solving managements poor pecuniary decisions at Fannie Mae, is to work the board of directors demand that top management executives at Fannie Mae bill down from their duties, or the Federal regulators should push parenthesis their ties with the coif. ADVANATGE: This utility(a) could assist correct and improve the current financial scrutiny the company is currently under. Since it is believed that certain top level executives allowed or highly-developed inappropriate accounting practices for either personalised gains or to over-exaggerate sugar growth, these people should be no long-acting be involved in the direct decisions of the company. This may mickle a actor within the company th at these types of actions will non be tolerated contemptible forward. Also, investors may feel relieved discerning that the individuals involved are no longer with the company, boosting investor confidence. DISADVANTAGE: This alternative may not inescapably solve the problem because it doesnt inescapably solve the poor ancient accounting decisions. It may alike be hard to terminate all that had their hands in this problem and then thither is the responsibility of hiring a cutting management team.
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ALTERNATIVE #2: The befriend alternative to the accounting problem is for the Fannie Mae management team to accommodate to recalculate, restate and ! coif earnings that were reported in the defy three historical period. ADVANTAGE: Restating and adjusting the past three eld earnings may decrease the current financial speculation the company faces today. Also, Fannie Mae may not have to add capital if the changes net knocked out(p) pie-eyed to zero. DISADVANTAGE: If they restate and adjust the past three years earnings and it... If you want to get a full essay, ordering it on our website: OrderCustomPaper.com

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