Accounting

Accounting is a fairly simple process. It's mostly a blend of basic math and common sense. The information, however, is often susceptible to manipulation and several interpretations. You can take the advice of former U.S. Supreme Court Justice Robert H. Jackson, who said, "Success depends on knowing what not to believe in accounting."

The term "creative accounting" is a euphemism for doctoring the books to make a company look better than it is, while "conservative accounting" makes a company look mediocre or worse. Most corporations prefer to look like heroes to stockholders and bag ladies to the IRS.

As an effective manager you may encounter a mass of incomprehensible figures can cover their confusion with such phrases as: Do you really believe this bottom line is realistic? Have you checked for a recent FASB (Financial Accounting Standards Board) ruling on this? How much could this change between now and the end of the quarter? And Are you sure overhead has been allocated properly? Perhaps the best comment of all, however, is "You'll have to simplify this so the board of directors will understand it." That probably means that you'll be able to understand it too.

It's important to consider the impact of the notes at the end of accounting reports, because these can reveal situations or conditions that figures tend to hide. For example, one company discreetly admitted that it was so strapped for cash that it had borrowed on the cash surrender value of its president's life insurance policy. Another's report celebrated a rise in its stock price, but the cause was the death of its founder and president

He was an autocratic octogenarian well past his prime, and investors apparently believed the business was better off without him. Notes may reveal what the figures conceal. Catchy slogan, isn't it?

Decision making , delegating , communicating as well as a simper understanding of basic accounting concepts that hold you steadfast in the turmoil of the management quagmire especially when you realize that most of your peers are incompetent . In most cases they were promoted either for personal or family reasons or as a reward for some behavior or achievement that has little to do with the task at hand

All in all the selection process may have been totally at odds with the long term health and profitability of the firm or organization