Question Essay Example | Topics and Well Written Essays - 500 words - 9

Question - Essay Example These defined liabilities are the results of the past events that will be turning into future economic outflows from the company, these liabilities successfully meet the standard definition of obligation but their measurement and computation is often observed to be a debatable issue. As the above-discussed liabilities are future expenses for the company, their future value computation may depend upon numerous factors. These liabilities are very sensitive to the rates of interest of the country and other external factors such as government policies, inflation rates, time value of money, and the probable date of maturity. Their date of maturity may change and solely depends upon the clauses and covenants placed upon them in the contracts. The lease commitments are the future payments of the leased item. Only the current liability under the lease agreement contains a true value of the lease payment for the year, the non-current liabilities hold an estimated figure to be paid in the future. The purchase obligation makes an organization to bound into a commitment of purchase of an item in the future date. The market value of the item in the future cannot be defined in the present period; an estimated value is considered in this case as well. In the case of marketable securities, the rates and maturity periods, and markets for the item are estimated based on assumptions. The derivatives also fall into the same category. The nature of these obligations makes it difficult for the company to reflect and present the real and accurate value of these items. Hence, there is a possibility that the liabilities been shown by the companies may differ from their actual worth. Ernst & Young LLP is the audit firm which performs external audit of Apple Inc. and PriceWaterhouseCoopers performs external audit of Dell Inc. The auditors of both

Finance - British Petroleum Essay Example | Topics and Well Written Essays - 2000 words

Finance - British Petroleum - Essay Example There were many reasons that affected the BP share prices during beginning of 2011. The issue that had highly impacted the BP share prices was the decision taken by Transocean Ltd after conducting an internal investigation. Transocean Ltd is the world’s largest offshore drilling contractor whom the BP had contract with. They provide the most versatile fleet of mobile offshore drilling machineries to assist customers find and utilise efficiently oil and natural gas reserves. Transocean Ltd announced on June 22, 2011 the release of an internal investigation report illustrating the reasons behind the explosion on the Deepwater Horizon rig on April 20, 2010. Transocean operated and owned the Deepwater Horizon rig that was drilling on the oil well in the Gulf of Mexico and their report had an impact on the BP prices the following weeks. In the opinion of Transocean, HP was to be held accountable for the disaster at the rigs as HP was controlling the drilling process at the oil well . The report explains that some of the inaccurate decisions made by HP resulted in the massive explosion on the oil well. According to the findings of the report the reason behind the explosion was the preparing a wrong design of the well, which was carried out by BP, together with an ineffective cement program. The guardian reports this; â€Å"the explosion and the oil spill was the result of a succession of well design, construction, and temporary abandonment decisions that compromised the integrity of the well and compounded the risk of its failure; the Swiss firm, Transocean Ltd, also said that many of the decisions were made by well owner BP in the two weeks before the incident† (The Guardian, 2011). Lacombe (2011) said that the report of Transocean can affect the BP share prices as it indicated that the decisions of BP included narrowing of the geological window in order to keep the drilling safe. Moreover, at the end of the week the BP share prices had declined to arou nd 437.15p (Yahoo Finance, 2011). However, after the sudden decline in the BP share price due to the Transocean report, the company was seen prospering in the market. Weatherford International was the first contractor whom the British Petroleum had been in association with at the Macondo oil well, and the business association continued for quite a long time. And when the financial management of the Weatherford International had taken the decision to clear all the settlement claims with the British Petroleum, the decision created a great effect on the PB share prices. In fact, Weatherford International was the first contractor whom the company was intending to make settlement with, and it was of great significance as the settlement process was moving forward and would potentially create a positive effect on BP share prices. Moreover, the financial management of the company decided to clear all its association at the Macondo oil well which has been the prime target at the oil spill at the Gulf of Mexico during last year. As Lacombe (2011), points out, when the good news about the Weatherford International’s settlement with British Petroleum at Macondo oil well was spread around, the BP share prices increased by 16.1p and was closed at 445.7p. Apart form these, Mitsui of Japan, one of the minority partners of the BP Company at the oil well, also made the decision to settle its claims with the company soon after the Weatherford I