HALLIBURTON, organizational problems Essay Example | Topics and Well Written Essays - 3750 words

HALLIBURTON, organizational problems - Essay Example Success depended on its ability to deliver on what it charged and this had impressed the United States Military and its other clients. No one appeared to mind Halliburton overcharging if the work that it delivered could keep the troops happy when they were far from home. However, within the recent past allegations of unethical conduct, overcharging, kickbacks and political influence peddling have marred the image of this company which still wins awards for performance in its industry. This essay presents a discussion about the ethical and organizational problems that confront Halliburton Energy Services. Halliburton Energy Services is a multinational corporation with operations in 70 countries of the world (NationMaster.com, 2005, â€Å"Halliburton Energy Services†). The group provides technical products and services for oil and gas production and exploration. Revenues of Halliburton Energy Services were in excess of US$ 15 billion in 2007 and it employs nearly 51,000 people worldwide (Halliburton, 2007, pp. 2 – 5). In 2007, its revenue grew by 18 % year-over-year and about 50 % of the total revenue was from outside North America. More than 100 nationalities work with Halliburton Energy Services Inc with most of the employees working in their home countries. This firm has an old history and it began operations in 1919 when Mr. and Mrs. Erle P. Halliburton started the firm and found work cementing oil wells in Burkburnett, Texas. The company was later to move to Ardmore, Oklahoma and then to Duncan, Oklahoma before becoming listed on the New York Stock Exchange in 1948. The major spheres of activities for Halliburton involve providing technical products and services for oil and gas exploration and production, handled by its Energy Services Group. However, Halliburton’s major subsidiary KBR, or Brown & Roots was a major construction company of refineries, oil fields, pipelines, and chemical plants (Briody,

A report in the context of the audit of public companies listed on the Essay

A report in the context of the audit of public companies listed on the London Stock Exchange regarding the two issues that the committee decided against implementing - Essay Example auditor’s bringing a fresh perspective and greater skeptism that would be lacking in the long-standing auditor-client relationship, the opponents maintain that because the auditor’s lack of familiarity with the industry and client, audit quality would suffer under such a regime (AICPA 1992). In late 2001, the Enron debacle followed by its high-profile collapse now focuses attention on the profession’s effectiveness in protecting the interests of the public. Thus, Sarbanes-Oxley Act 2002 mandated the General Accounting Office (GAO) to conduct a research on the potential effects of mandatory audit rotation as required by law. The study concluded that mandatory audit rotation would not necessarily strengthen auditor independence (G.A.O. 2003). The arguments for and against mandatory audit firm rotation contend whether the auditing firm’s long-term client-customer relationship and the profitable desire to maintain the client adversely affects the public accounting firm’s independence during the auditing of a company’s financial statements. Furthermore, reservations about the likely effects of the audit firm rotation include the fear of losing company-specific information gathered by an audit firm over years of experience as an auditor, and whether the intended benefits are likely to outweigh the costs. Additionally, the implementation of the Sarbanes-Oxley Act (as applied in the United States) has raised question as to its effectiveness of reforming the intended benefits of mandatory audit firm rotation. Furthermore, research studies and other publications specifically show that the advantages and disadvantages of mandatory audit firm rotation touch on auditor independence, audit quality, and increased costs. Interference with auditor independence or audit quality can result in failure and adversely affect the parties relying on the fair representation of the financial statements in conformity with established accounting standards. Proponents of audit