The different types of fraud that were committed by Enron.

TABLE OF CONTENTS Introduction..........................................................................................1 Who Committed Fraud?.....................................................................1 - 2 How Was Fraud Committed?...............................................................2 - 4 Why Was Fraud Committed?...............................................................4 - 5 Penalties Of Committing Fraud.............................................................. 6 Ways Of Preventing Fraud............................................................... 6 - 10 Conclusion...................................................................................... 10†¦show more content†¦Here are two example partnerships, which show how Fastow, Kopper, and Skilling worked together to commit this fraud. One of the first partnerships that they made was called LJM. LJM was a project that was started to fix a so called problem Enron had of not being able to sell, or put in paper an Internet start-up company that would make Enron look good. Because of not being able to do so Enron started a risky partnership with a company in the islands called LJM. Enron funded LJM with its own stock in order to fake the books. The second partnership was called Chewco. The main story with Chewco was that Fastow wanted to run Chewco but he couldnt because of a conflict of interest. So what Fastow did was put Kopper in control of Chewco. Here is where the fraud comes in, in order to cover up the connection between Chewco and Enron, the investments done by Kopper to Chewco was done under a partners name. When Enron decided to buy Chewco, Fastow made Kopper drive up the price of it in order make profits for himself and Kopper, and any other money Kopper received from the selling of Chewco to Enron he shared with Fastow, this is how they committed their money laundering and wire fraud. The next key player who committed fraud was Jeffrey Richter, the former head of Enrons Short-term California energy trading desk. He also committed wire fraud. Richter committed wire fraud specifically in one way. He was the one in charge of supervising the department of Enron thatShow MoreRelatedMethods Of Aggressive Accounting By Issuing Financial Statements1199 Words   |  5 Pagesflows, or understating any debts and expenses are examples of this type of fraud. These accounting swindles allow companies to have an efficient public appearance to investors and potential creditors. Nevertheless, according to a recent journal article from (Chen Huang, 2013), these deceitful activities led to abnormal stock returns and unfavorable open-market purchases and repurchases. The statements from the financial disclosures were so unclear, yet seemed too good to be true. Consequently, a wideRead MoreAccounting Is The Most Boring1478 Words   |  6 Pagesauditors, corporations still manage to circumvent the proper accounting techniques that prevent fraudulent behaviors. Because of the consequences observed from the Enron and WorldCom scandals, stronger laws and stricter regulating requirements for businesses are a necessary issuance to address the causes of fraud and how it is committed. Current rules applied to corporations in regards to their financial statements are insufficient. Corporations are viewed as a public entity, and appear to have noRead MoreEthical Codes Of Conduct Are Secondary Thoughts1531 Words   |  7 PagesEnron, WorldCom and Bank of Credit and Commerce, just to name a few, runs chills up and down the spines of, well, just about everybody. These scandals swirled around several large businesses, and hinged on unethical practices – unethical accounting practices, specifically. The idea of ethics is a hot button these days in all genres. In fact, universities and colleges are including ethics in the curriculum of every discipline instead of offering an ethics major, per se (Kanaiah Kumar, 2009).Read MoreEssay on White-Collar Crime Vs. Street Crime1070 Words   |  5 Pagespunishments than street crime. This paper will first discuss the similarities between the two types of crime and then explain why their punishments are strongly diff erent. Lets first start off by defining each one of these types of crime. Street crime is a loosely defined term that usually refers to criminal acts that are done in public. Currently, society is more aware and familiar with this type of crime. Examples of street crime include homicides, shootings, robberies, etc; crimes that areRead MoreWhite Collar Crime1407 Words   |  6 Pagesto late 1990s. With the downfall of companies such as Enron, Tyco Toys and WorldCom MCI white collar criminals are facing lengthy prison sentences. Greed and personal vendettas are what have led our country to understand and gain more knowledge about these corporations and the corrupt CEOs that have brought them to their demise. â€Å"White collar crime is defined as various crimes, as embezzlement, fraud, or stealing office equipment, committed by business or professional people while working. GenerallyRead MoreThe Sarbanes Oxley Act Of 20021274 Words   |  6 Pagesrecently the financial crisis of 2008. The government has tried to learn from these past events and implement new procedures that would prevent from occurring once again. However, it seems like there is always something new to learn from when these type of events occurs. As such, the government always tries to addressed the issues, but in some instances are praised and in some criticized. Two of the most important legislature that have been passed in order to prevent financial crisis and protect theRead MoreHow Fraud in the Financial Markets Influence Government Action1255 Words   |  6 Pagespotential investments. Unfortunately, as we have seen in recent history with Enron and Bernie Madoff, there are companies and/or individuals that are a mong us trying to take advantage of what they feel is an opportunity to make easy money. Essentially, these companies and/or individuals are committing some type of financial fraud to cover up their â€Å"robbing Peter to pay Paul† type schemes (Museum of†¦, 2010). This [financial fraud] epidemic is not something that is new to the financial world, it’s beenRead MoreWhite Collar Crimes And Criminal Offences1238 Words   |  5 Pages â€Å"Bank robbery is down by half over the last decade, check fraud has declined in recent years, and cyber crime is surging† (Scanio and Ludwig). Fraudulent activity is everywhere. It is a crime even though there are no victims. Scams, price fixing, wiring accounts, fraud of all sorts, etc are all types of white-collar crimes. Not all crimes that are committed are even performed by the Chief Financial Officer. It has become more accessible, to commit these crimes, with the mass amounts of internetRead MoreThe Sarbanes Oxley Act : Unexpected Benefits Essay1517 Words   |  7 Pagesin, which held a majority of the portfolio of stock, has been participating in financial fraud. While they had been presenting themselves well, under the surface deceptive accounting and financial practices were being use d and now the company is broke. All of your hard earned money which was invested in that company is now gone-down to the last penny. Does this sound vaguely familiar? It should. In 2001, Enron, a United States company, became the very largest bankruptcy and stock collapse in historyRead MoreOverview of Forensic Accounting Essay2975 Words   |  12 Pagespeople really know what it is. Well look no more; you came to the right place. This paper will discuss the ends and outs of forensic accounting. For example, the certifications required to become one, the history of forensic accounting and many different types of crimes that forensic accounts handle. Forensic accounting is an investigative style of accounting used to verify whether a single or company has occupied with any illegal financial movement (Forensic Accounting Online, 2013). It is used to

Fenders Supply Chain Management - 2494 Words

The worlds manufacturing leader--Fender Guitar Company which was established in 1946, the full name of Fender Musical Instruments Corporation. In the past 60 years, Fender has become one of the hallmarks of the United States. The contribution of Fender sounds modern music development has already been spread in global and still continuing. Through the first to introduce the commercialization solid electric guitar, produced the first electric bass and numerous classic speaker. The style of Fender musical instruments includes jazz, pop, rock, country music and so on. Everyone from beginners to enthusiasts and even the world-renowned performers all can find the suitable musical instruments for them. Fender intends to position itself in the†¦show more content†¦2003 early, Fender made some adjustment for its family of products Gretsch and started the production and distribution of new Gretsch guitars. 2.3 Fenders new supply chain strategyFender plans to promote their products can be more clearly conveyed. They announced in Feb. 2007 will be to produce a product guide with illustrations of replace the traditional front-line journal of the year. This change in order to give publicity by its supply chain cost considerations, The traditional cost of printing, as well as the most trend copyright convenient substitute for internet magazine, which can solve the printing, distribution, copyright issue of cost and time. The guide contains a set of new Fender product introduction and picture. The new Fender Frontline In-Home will be conveyed to customers the latest products of Fender, and the provision of mail to customers if they need and have registered in the Fender website. This shows that the Fender was constantly improving its customer service systems to optimize their supply chain management. 2.4 Fenders Australia supply chainFender in Australia has a complete supply chain system, but it still has a few aspects need to improve. Fender established more than 92 local authorized dealers in the Australia, 26 in NSW (HREF 2). Fender distributes Recommended Retail Price (RRP) information to all of itsShow MoreRelatedFedex Case Study on Creating Value1256 Words   |  6 Pagesglobal, knowledge-based logistics business. An increasing number of companies, some of which have been loyal FedEx customers that rely on the value FedExs speed and reliability competencies create for them, are carefully studying the supply part of their value chains. By more effectively coordinating all of their inbound and outbound logistics activities, firms can reduce a number of their costs, including those associated with purchasing raw materials as well as expenses that are incurred to storeRead MoreAccounting Information System Chapter 1137115 Words   |  549 Pagessuccessful transfer. Doing so may enable the organization to take steps to mitigate likely causes of resistance. The design of an AIS, however, itself can influence and change an organization’s culture and philosophy. Therefore, with adequate top management support, implementation of a new AIS can be used as a vehicle to change an organization. The reciprocal effects of technology and organizational culture on one another, however, mean that it is unrealistic to expect that the introduction of a

Organic and GMO Essay Sample free essay sample

Before the organic nutrient concern started to take its up ascent. consumers did non give much dither to the ingredients of their procedure nutrient. Peoples did non look to care that much on reading labels. non detecting the batch of chemical names listed at the dorsum of the processed nutrient bundle. These chemicals. more frequently than non. are derived from non-food stuffs. Processed nutrient normally has unreal chemicals for colourising. several compounds for flavorers. and at least one chemical to move as preservative. Yet. people still loaded their kitchen with sausages and french friess. But times have changed and in recent old ages. consumers have started to go health-conscious. in the nutrient they eat. Organic nutrients easy became popular non merely to parents but to those who want better and natural nutrients. A 2006 survey conducted by market research house The Hartman Group revealed that in a span of five old ages. organic nutrient purchase have grown significantly in the United States ( The Hartman Group 2006 ) . In fact. 49 % of American consumers have started to replace their nutrient and drink with organic 1s ( 2006 ) . Furthermore. 23 % of these consumers purchase organic merchandises on a regular ( hebdomadal ) footing ) . While purchasing organic goods at food market shops have dropped ( 63 % in 2000 to 58 % in 2005 ) . consumers purchasing at price reduction shops and super centres have grown- up to 15 % from 9 % ( 2006 ) . It besides reports that two cultural and racial groups are at the nucleus of purchasing organic products- Asiatic Americans and Latino Americans ( 2006 ) . Latino Americans are more likely to purchase organic nutrient than Caucasians ( 2006 ) . One of the emerging grounds for traveling organic is the impact of endocrines in nutrient merchandises and their consequence on one’s wellness. particularly the kids ( 2006 ) . In another study conducted by The Organic Trade Association released in 2005. the study province that by 2025. the organic industry would boom. albeit at a slower gait ( The Organic Trade Association 2005 ) . It besides estimates that in the aforesaid twelvemonth. organic merchandises would hold been sold â€Å"anywhere and everywhere† ( 2005 ) . Restaurants would besides fall in the bandwagon. with increased gross revenues in organic merchandises ( 2005 ) . When asked which organic nutrient merchandise class would see the biggest growing. meat. fruit and veggies topped the list. followed by babe nutrient. grain merchandises and bites ( 2005 ) . Furthermore. the study stresses the function of organic products’ makers and distributers in the success of the organic industry through instruction. selling and debut of new merchandises ( 2005 ) . Internet’s popularity would besides play in cut downing cost. therefore conserving natural resources in the procedure ( 2005 ) . By 2025. organic merchandise purchase would be done online or via ecommerce and the supermarkets would function as a kind of school where the populace would be educated on organic merchandises ( 2005 ) . In short. consumers would no longer travel to supermarkets to purchase goods but to hold a wider understanding on wellness concerns such as pubescence and climacteric. malignant neoplastic disease. etc. ( 2005 ) . The study besides concurs with The Hartman Group’s happening in stating that Asiatic Americans and Latino Americans make up the largest ball of organic merchandises consumers ( 2005 ) . Furthermore. The Organic Trade Association says that involvement in organic nutrient would no longer be limited to older people but would include the younger set of the population ( 2005 ) . It ends the study by underlining the importance of authoriti es support in the growing of organic agribusiness and the industry every bit good ( 2005 ) . So what is organic nutrient? Ask a chemist and his reply would be nutrient that has C ( Anderson A ; Deskins 1995 ) . However. the popular definition is nutrient produced sans the usage of man-made fertilisers. pesticides. or other procedures ( US Department of Agriculture 2007 ) . Furthermore. husbandmans that produce organic nutrient continue the environment by utilizing â€Å"renewable resources† through preservation of dirt and H2O ( 2007 ) . Animals raised on organic farms are merely fed with organically grown provender. without the usage of antibiotics and man-made growing endocrines ( DeCostole. 2007 ) . The authorities. US authorities in this instance. would hold to O.K. a merchandise before it could be labeled as â€Å"organic† . Organic-labeled merchandises are those that have passed the US Department of Agriculture criterions ( 2007 ) . The Organic Food Production Act ( OFPA ) . which was portion of the 1990 farm measure served as the foundation for Torahs regulating organic nutrients ( 1995 ) . The National Organic Standards Board came up with a list of demands. Among the major commissariats: Additionally. in order for processed nutrient to be labeled as â€Å"organic† . 95 % of ingredients must be organic. non including the salt and H2O ( Anderson and Deskins 1995 ) . However. if the per centum falls above 50. the merchandise may label the organic ingredient used ( 1995 ) . For illustration. a chili processed merchandise may stipulate the organically adult beans used ( 1995 ) . When organic nutrient is concern. consumers frequently find nutrient merchandises with the label â€Å"Non GMO. † GMO is short for Genetically Modified Organism. A GMO is an being that has undergone technology procedure to achieve a specific consequence ( US Department of Agriculture 2007 ) . To understand GMO. it is better to get down from the start- familial technology. Familial technology is a signifier of biotechnology. embracing procedures such as cross-breeding. works hybridisation and agitation ( Genetically engineered nutrient 2000 ) . Familial technology has been used for a assortment of applications from medical applications to nutrient production ( 2000 ) . It has been given much ballyhoo. particularly in the country of nutrient production. Genetic technology offers a long list of promised benefits from decrease in the usage of pesticides. weedkillers. and fertilisers to disease opposition and addition in nutrient supply ( 2000 ) . However. several concerns have been raised with familial technology such as deficiency of long term surveies on nutrient safety and its impact on the environment ; pesticide and weedkiller tolerance ; carnal inhuman treatment. increased toxic degrees in nutrients ; and ethical and religious concerns ( 2000 ) . The Organic Trade Association is inexorable in its base against GMO ( Organic Trade Association 2007 ) . In its web site. the organisation believes that scientific informations on long –term effects of GMO is deficient ( 2007 ) . The organisation is non entirely. In a random canvass conducted by ABCNews. com in 2001. 57 % of the 1. 024 respondents said they would less likely to buy genetically modified nutrients ( 2007 ) . Furthermore. 52 % of the respondents would instead purchase organically adult nutrients instead than genetically modified 1s ( 2007 ) . What makes organic nutrient the healthier pick for ingestion is the absence of pesticides. Without fertilisers. workss heighten the production of phytochemicals. which self-praise of vitamins and antioxidants ( DeCostole 2007 ) . Farmers use pesticides for a figure of reasons- plague control. better nutrient visual aspect. widen shelf life. and increase production volume ( Whitford and Mason 2008 ) . Pesticides besides enable husbandmans to increase their nutrient production into new countries ( 2008 ) . However. one major drawback found from utilizing pesticides is the consequence of it on the consumer’s wellness. There have been assorted scientific and medical surveies conducted on the effects of pesticides on animate beings. Results show that pesticides cause malignant neoplastic disease in research lab animate beings ( Whitford and Mason 2008 ) . In another study by the National Academy of Sciences. it found that even pesticide exposure in low degrees is toxic for foetuss and kids ( Decostole 2007 ) . Children. specifically. are more vulnerable because of their weakened immune systems ( 2007 ) . The Food and Drug Administration ( FDA ) . together with the United States Department of Agriculture ( USDA ) have created a pesticide residue monitoring plans ( 2008 ) . The plan is established to observe residues. Food samples. domestic and imported merchandises. are retrieved every twelvemonth and are analyzed to observe pesticides or metabolites ( 2008 ) . Furthermore. the monitoring plan offers a glance of â€Å"potential exposures to pesticide residues† ( 2008 ) . But the plan is limite d to such. It does non give information on the effects of rinsing. desquamation and processing of the pesticide residues ( 2008 ) . Consequences show that pesticides residues are still within the â€Å"legal tolerance† ( Whitford and Mason 2008 ) . This is good for it means that husbandmans know the proper direction of pesticides ( 2008 ) . But pesticide taint is non every bit much concern in meat and dairy merchandises. Harmonizing to Chuck Benbrook. main scientist at The Organic Center. a non-profit-making research organisation. provinces that scientists express their concerns on the antibiotics given to farm animate beings ( DeCostole 2007 ) . Benbrook explains that the overexploitation of antibiotics allow animate beings to be immune to them. therefore may non be able to contend the infection. To assist consumers. Environmental Working Group. a non-government organisation. has produced a usher on the green goods ranking on pesticides ( Environmental Working Group 2006 ) . The usher inside informations what it calls the â€Å"dirty dozen† . bring forth that requires more pesticide: Prunus persicas. strawberries. Prunus persica nectarinas. apples. Spinacia oleracea. Apium graveolens dulce. pears. Sweet bell Piper nigrums. cherries. murphies. boodle and imported grapes ( 2006 ) . The cleanest green goods or those that have the lowest sum of pesticides are onions. alligator pear. sweet maize. Asparagus officinales. Chinese gooseberry. bananas. chou. Brassica oleracea italica and aubergine ( 2006 ) . Aside from the promised wellness benefits of organic good. advocates of organic nutrient besides say that organic agriculture is better for the environment. Harmonizing to The Organic Trade Association. organic agriculture is good to the environment ( DeCostole 2007 ) . It decreases groundwater pollutants and allows richer dirt to cultivate workss better ( 2007 ) . Organic agriculture besides helps in cut downing eroding ( 2007 ) In a survey published in the Proceedings of the National Academy of Sciences ( PNAS ) . Stanford University research workers found that conventional agribusiness. one that uses fertilisers. can bring forth inauspicious consequence in the environment such as nitrogen pollution ( Scwartz 2006 ) . Nitrogen pollution is caused by the nitrogen-based agricultural fertilisers. which the survey says. would treble by 2050 ( 2006 ) . Harold Mooney. one of the co-authors of the survey. explains that N taint is risky to major rivers. fouling H2O tabular arraies ( 2006 ) . The survey involves researching on the effects of fertiliser and organic provenders on apple trees ( 2006 ) . Analyzing the groundwater taint and N gas emanation. consequences show that man-made fertilisers leak inordinate N. This extra N leaks through the dirt and groundwater. impacting the aquatic ecosystem ( 2006 ) . On the other manus. the organic feed-grown tree does non increase the production of N ( 2006 ) . This leads t o the decision that organic agriculture is good to the environment. The research workers endorse the usage of organic agriculture in lending to the sustainability safe and environment-friendly agribusiness. As Mooney adds. organic agriculture is an of import tool is continuing the agricultural system and it is of import to research such techniques to diminish the planetary job of feeding 6 billion people ( 2006 ) . Plants Cited Anderson and Barbara Deskins.The Nutrition Bible.New York: Quill William Morrow. 1995 ) . DeCostole. Jessica. â€Å"The Truth about organic nutrients. †Redbook Magazine. September 2007. Environmental Working Group. 2006. Get the Guide. 24 March 2008. lt ; hypertext transfer protocol: //foodnews. org gt ; â€Å"Genetically engineered nutrient ; your right to cognize. †Healthy Options News Digest January/February 2000: 7. Organic Trade Association. 2007. Familial Engineering and Agriculture. 24 March 2008 lt ; hypertext transfer protocol: //ota. org gt ; The Hartman Group.Organic2006: Consumer Attitudes A ; Behavior. Five Old ages Later A ; Into the Future.United statess: The Hartman Group. 2006. Scwartz. Mark. 2006. New Studies Confirms the Ecological Virtues of Organic Farming. 24 March 2008. lt ; hypertext transfer protocol: // hypertext transfer protocol: //news-service. Stanford. edu gt ; US Department of Agriculture. 2007. Organic Food Standards and Labels: The Facts. 24 March 2008 lt ; hypertext transfer protocol: // Ams. usda/gov/nop/Consumers/brochure. hypertext markup language gt ; Whitford. Fred and Linda Mason. 2008. Pesticides and Food Safety. 24 March 2008. lt ; hypertext transfer protocol: // hypertext transfer protocol: //www. btny. purdue. edu/pubs/PPP/PPP22. hypertext markup language gt ;

Insole In Order To Bring Fairness In Matter-Myassignmenthelp.Com

Question: Discuss About The Insole In Order To Bring Fairness In Matter? Answer: Introduction In Australia, it is the Corporation Act 2001 that guides and regulates Insolvency of a company. Insolvency is no where defined but absence of solvency is considered to be the most precise definition of Insolvency. Now, the question arises is what is solvency of a company. It is submitted that a company is said to be solvent when it has the capacity to pay all of its liability and debt whenever the same fell due. (Swaab, 2009) The basic aim for the enactment of the insolvent law in Australia is to bring out a balance of interest of creditors, debtor, and public at large. The Insolvency laws try to lay down a fair procedure so that the assets of the company can be distributed equitably and equally. The procedure of insolvency must be such so that the debts so arises can be paid without much delay and adequate. Both the creditors and debtors of the company must be involved in the management of insole in order to bring fairness in the matter. It is now important to understand the concepts and law behind insolvency. Insolvency What is insolvency is the main question that needs to be target first? Section 95A of the Act tries to explain the true meaning of Insolvency. As per section 95 A, sub section 1 , a company is solvent when it has the ability to pay all of its debts when the same become payable. As per sub section 2 of section 95A, any organization or a person is considered to be insolvent when the same is not solvent in nature. In Sutherland v Hanson Construction Materials Pty Ltd (2009), the Supreme Court of New South Wales has submitted that what is solvent can be determined as per the cash flows of the company. (Latimer, 2012) Thus, the two main elements that must be looked into in order to determine the insolvency of the company are: Debts - That the company is at the obligation to pay its dues; Due and Payable - That the financial position of the company is not such that it is able to pay its debts when the same became dues and payable. It is thus submitted that the contrary of solvent results in insolvency of any organization/individual. In recent times the insolvency of the companies has been tremendous in nature. The rate with which the insolvency of the companies is increasing is tremendous. Around 10,000 companies go into administration every year. In around April 2011, there were around 9747 companies that went into insolvency. Compared with the previous five years, the increase is approximately 16%.. compared with 2010, there is an increase of 6%. The secured creditors ahs appointed 1356 in 2011 which is 73% increase from the last five years. In 2011, the first seven months saw 5852 administrations. In June 211, there were around 1027 insolvencies that took place. There were around 240 companies that went into court liquidation, 3835 in creditors voluntary liquidation, 1219 in receivership and 1332 in voluntary administration. (Insolvency, 2016) Thus, the rate with which the insolvency of the courts is increasing is tremendous. Once it is established that a company is insolvent then what is the actions that must be taken by the company. At this stage, the role of a director is very important. It is necessary to understand the actions and proactively that is required of the directors in insolvency. As per section 124 of the Act, a company is an artificial legal person but has the capacity to enter into contracts, sue and be sued, purchase assets etc. However, a company does not have a mind to think and thus it acts through its officers. As per section 198E (1) of the Act, the company director is the person who mainly manages and controls the affairs of the company. (Bottomley, 2016) Thus, when any company is insolvent or on the verge of insolvency then there are various action that are expected from the director because he is the main authorized person who commands the acts of the company. The prime acts of the director include, firstly, he must make sure that no further liability or debt is incurred by the company; secondly, if there are no chances that restructuring of the company can be done, or there is availability of refinance or equity funding, then, the director must either appoint a liquidator or a voluntary administrator; thirdly, as per section 588G of the Act, it is necessary that there must be no trading when the company is insolvent by the company director; fourthly, every Director must ensure that all the specific and general laws must be comply with; fifthly, every duty and power of the director must be complying with utmost care and diligence; sixthly, the financial position of the company must be clear and in the knowledge of the director; seve nthly, as per section 182 and 183 the position and information of the company must be used by the director in order to bring benefit to himself; eighthly, that the books and records of the company must be properly maintained by the director; It is ths very important that every action of the director must be carried out keeping in mind the interest of the stakeholders, employees and the creditors. The acts of the director must be in the best interest of the company and in good faith. Now, if the company still becomes insolvent then there are few liabilities that are faced by the company director in all manners. When a company becomes insolvent then there are series of consequences and penalties that are faced by the directors of the company, firstly, there are civil penalties which includes, firstly, a director may face pecuniary penalties of an amount up to $200,000; secondly, the creditors may initiate compensation proceedings against the directors; thirdly, ASIC and the liquidator are also authorized to commence compensation proceedings; fourthly, the compensation proceedings many a time results in the bankruptcy of the director which ultimately results in the disqualification of the director. Also, there are criminal penalties which includes, firstly, if insolvent trading is incurred and the major reason for insolvent trading is found to dishonesty on the part of the director then such director may be fined for an amount up to $220,000. He may also be send to jail for five years or both; secondly, the director can be disqualified from his post. (ASIC, 2017) So, a company director must be very diligent while carrying out his actions so that no insolvent trading is incurred. Now, once a company is found to be insolvent then what are the various avenues that are available to such insolvent company? What are the options that are available to the director if the company is presumed to be insolvent? The company director is the main officer of the company who is assigned with the tasks of managing the affairs of the company. If the company is unable to pay its debt when become due then it is considered to be insolvent in nature. In such cases, the first question that comes in the mid of the directors is the next step that should be taken in order to protect the interest of the shareholders, creditors and investors of the company. There are mainly three avenues in front of the company director to choose from. The same are: Firstly, Voluntary administration and it is the quickest method that can be availed by an insolvent company in order to decide the future course of the company. In Voluntary administration, administer is appointed who is a qualified person and is independent in his operations. It is necessary to seek the written consent of the liquidator who agrees to act as a voluntary administrator. He takes the full control of the company and the main tasks of the voluntary administered are to conduct his actions in such manner so that the company can be saved or the business of the company can be protected. If there is no scope of protecting the company or its business then the next target of the administrator should be manage the company affairs in such manner so that maximum advantage can be provided to the creditors. This can be done with the help of formulating Deed of Company arrangement. (Hanrahan Et al, 2017) Secondly, Liquidation and when the company is insolvent and the only option that is left is the wound up of the company, then, the most beneficial way is to liquidate the company. The director calls a meeting of the members wherein voting for the winding of the company is carried on and there is an appointment of a qualified and independent person who acts as the liquidator of the company. He takes the control of the company and carries the conduct of the company in such manner so that maximum benefits can be attained by the creditors of the company. Now there are voluntary and involuntary interventions by different parties concerned by the potential insolvency of the company. The same are of two kinds a) Voluntary or Creditors Voluntary Liquidation and carried when the business is insolvent and requires cease trading then Creditors Voluntary Liquidation is carried out. The members and directors pass a resolution for winding up and appoint a liquidator. The liquidator sells out all t he company assets and repays the secured creditors; b) A creditor can seek the help of the court for involuntary wining up of the company. The court may appoint a liquidator (IMF, 2012) Thirdly, Receivership wherein the secured creditor appoints a receiver who holds security over the assets of the company. He sells the assets in order to repay the liabilities of the secured creditor. (Hanrahan Et al, 2017) However, It is submitted that apart from being liquidated, there are two best methods that can be attained when the company is declared insolvent. The same are firstly, Deed of Company Arrangement (DOCA), wherein a contract that is established amid the creditors and the company are called DOCA. At the second creditors meeting approval of the creditors is required. The deed is binding upon the shareholders, company, unsecured creditors and directors of the company. The deed is binding upon only those secured creditors who voted in favor of the DOCA at the meeting. If the DOCA is approved by majority creditors then there is no need for any approval from the court. As soon as DOCA is executed, there is termination of the voluntary administration; secondly, Schemes of arrangement wherein restructuring tool and is applicable regardless whether the company is insolvent or solvent. It is a kind of proposal which is laid down wherein the stakeholders compromise their rights. This proposal re quires the confirmation of the creditors and by the time the confirmation comes the pre existing management controls the company. In order for the scheme to work, it is necessary that the same must be confirmed by at least 75% in form of creditors value and at least 50% in number in each class of creditors. The class of creditors is those whose rights are affected by the scheme. This approval scheme must be approved by the court so that it becomes effective. The main outcome of the scheme is that the company is still floating but with the compromises auditing made part of the scheme. (Australia, 2016) Thus, the insolvency of the company is not a good thing for all the parties that are associated with the company. Apart from winding up, DOCA and scheme of arrangements are the two methods with which the company can be remain floating. ASIC is Australian Securities and Investment Commission with main aim to regulate the financial services, markets and corporate in Australia. When the company is insolvent the ASIC also plays a significant role. The same are firstly, when a company is declared insolvent and there is compensation proceeding to be initiated, then, ASIC is authorized to initiate proceedings in favor of the creditors who have lost their money; secondly, several programme are run by ASIV to make the directors aware of the consensuses, rights, liabilities and duties that must be performed by the directors in case of insolvency; thirdly, directors are prosecuted by ASIC who are found to be involved in insolvent trading; fourthly, it has the task of registration of the liquidators and the administrators there by giving authenticity to the process of insolvency; fifthly, lays down proper procedural framework in case a company is found to be insolvent. Thus, ASIC plays a significant role when there is insolvency. (ASIC, 2017) Conclusion It is thus concluded that a company when is not able to pay its debt when they become payable results in the insolvency of the company. Once a company is insolvent it lays down several responsibilities on the shoulders of the directors which if not performed by them results in raising several liabilities upon them. It is thus very important that instead of looking for options after the company insolvency, it is necessary that steps should be taken so that a company does not become insolvent at the first place itself. Reference List Books/Articles/Journals ASIC (2017) Directors - What are my duties as a director?. Bottomley, S, (2016). The Constitutional Corporation: Rethinking Corporate Governance. Routledge. Hanrahan Et al, (2017) Commercial applications of business law (2017)18th Edn. IMF (2012) Australia: Insurance Core PrinciplesDetailed Assessment of Observance, International Monetary Fund,21-Nov-2012. Latimer, P (2012). Australian Business Law 2012. CCH Australia Limited, 2012. Case laws Sutherland v Hanson Construction Materials Pty Ltd (2009), Online Material Australia (2016) Restructuring and Insolvency (Online) Available at: https://gettingthedealthrough.com/area/35/jurisdiction/5/shareholder-activism-engagement-israel/. Accessed on 14th September 2017. ASIC (2017) Directors - Consequences of insolvent trading (Online) Available at: https://asic.gov.au/regulatory-resources/insolvency/insolvency-for-directors/directors-consequences-of-insolvent-trading/. marketing on 14th September 2017. ASIC (2017) our role (Online) Available at: https://asic.gov.au/about-asic/what-we-do/our-role/. Accessed on 14th September 2017. Insolvency (2016) (Online) Available at: https://www.rebuildnow.com.au/insolvency-statistics/. Accessed on 14th September 2017. Swaab (2009) Australia: An Introduction To Insolvency Law - Part One (Online) Available at: https://www.mondaq.com/australia/x/79816/Insolvency+Bankruptcy/An+Introduction+To+Insolvency+Law+Part+One. Accessed on 14th September 2017.