Question

Engineering Economics Analysis

Use a personal example or a published source to analyze what went wrong or right with respect to ethics at the assigned stage(s) of the decision-making process.

A)Recognize problem

B) Define the goal or objective

c) Assemble relevant data.

d) Identify feasible alternatives.

e) Select the criterion for determining the best alternative.

F) Construct a model

g) Predict each alternative's outcomes or consequences.

h) Choose the best alternative

i) Audit the result

Answer 1

One of the most famous cases include the corporate scandal by Satyam Computers where facts and figures were misrepresented and balance sheet was inflated.

Analysis

1. Problem recognition- misrepresentation of balance sheet and extrapolated numbers
2. Objective - to achieve maximum share price and market Capitalization
3. Assembly of data- Net profit was doubled and costs were hidden and classified under Miscellaneous expenses
4. Alternative - Usage of Best Auditing team and rotation kf auditor could have averted the issue
5. Best Alternative Criteria is the one which identifies any misconduct and is fullproof.
6. Model Construction - Auditing balance sheet using different accounting standards and from different audtors perspective would bring in transparency
7. Consequences - This would identify any loopholes and bottlenecks in handling of transactions as well as all deals passed and give through information of all contracts and way of getting it passed.
8. Best Alternative - Different auditors rotation willgive multiple perspectives and rule out any misrepresented figures
9. Audit results _ This can be further audited by team of board menbers and independent neutral consultants