Accounting, Edition 38

Accountancy in the Eye of the Hurricane

By: Sylvia Meljem
ITAM

This article briefly analyzes the major trends in business today and their repercussions on the information value chain industry, which encompasses most of the activities carried out by accountants.

The Forces that are transforming the world

According to a 2010 study by Ernst & Young, the results of which were published in a paper called Business Redefined, the forces transforming the world today are vast, complex, challenging, and are moving with an unprecedented speed and intensity.

Renowned futurologist Dr. Ian Pearson says that in 2020, the business world will be defined by the following features:

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Accounting, Edition 37

Determining Credit Spreads for Private Firms That Have No Credit Rating

By: Dra. Paula Morales, Dr. Francisco Guijarro and Dr. Janko Hernández

By nature, companies must pay–or be prepared to pay–a price for the goods and services they use in their activities, what ever their area of business. So clearly companies require financial resources in order to make those payments. As we all know, there are three main sources of funding: internal resources generated by the company’s operations, funds contributed by the company’s owners or partners, and funds raised through some form of debt.

Generally, companies take on debt according to the characteristics of the products or services offered, the commercial phase of the business, the type of market in which they operate, legal and tax restrictions, and other factors. According to the rating assigned to the company by a rating agency or credit institution, lenders decide what interest rate must be paid on the loans that will be extended to the company, or what yield at maturity a bond issued by that firm must offer.

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Accounting, Edition 36

NGO Management Models

By: Ana María Díaz

The risks and drawbacks facing NGOs in Mexico are mainly of a financial and regulatory bent, and tend to affect mainly organizations with weaker structures, undermining their ability to produce the desired results and, in some cases, threatening their very existence. Some of the problems most often encountered include: the absence of a regulatory framework, inefficient management systems and budget controls, inefficacy of the projects undertaken and lack of transparency in the rendering of accounts, while the poor performance of such organizations can be indirectly attributed to Mexico’s incipient culture of donation.

The term “Non-Governmental Organization” or its abbreviated form “NGO” became generalized when the UN wanted to distinguish between specialized inter-governmental entities and private organizations. NGOs are civil society organizations created by volunteers independently of local, regional and national governments and international organizations in response to needs not met by the State. Their goals and purpose are defined by their volunteers, who champion a specific cause, commit to a series of humanitarian undertakings, make governments aware of society’s concerns and oversee programs to ensure these are implemented in accordance with established policies.

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