Cash Flow

Assume you are an executive at a small but growing company. In a meeting, the CEO complains that, while balance sheet and profit and loss statement show that the company is growing profitably, it has problems paying its bills as it is constantly short on cash. The CEO asks you to look into this problem and try to determine ways to deal with these constant shortages. Discuss why a profitable and growing company may have cash flow problems and what operational steps you may be able to take to improve the situation.

In response to your peers, discuss with each other why even profitable companies may experience shortages of cash and what operational steps could be taken to alleviate the problem.

GAAP versus IFRS

Your company has recently opened a facility in Ireland where you produce articles intended for sale in the EU. Your accountant informs you that GAAP rules, which govern accounting in the United States do not apply in Ireland. He recommends that the company researches IFRS to help with the difference between accounting in the two countries. You have never heard of IFRS before and go to Investopedia (please review a resource in this Unit's reading and resource section) to begin researching the standards. Based on your initial research discuss the challenges that you anticipate when consolidating the results of your Irish facility with that of your US headquarters.

Discuss the accounting challenges a company that has operations in foreign countries faces when reporting corporate results.