Article ReviewI agree with the statement that the author makes. This is because the flexibility that GAAP allows may present a moral hazard for managers to engage in earnings management in an effort to present results that show a favorable position of the entity. A study by McVay presents an example of imprudent practices that GAAP may allow. In the study, McVay argues that managers may misclassify items in the income statement thus leading to the presentation of a performance that is more favorable than the entitys actual performance. Such misclassification arises from the discretion that managers are allowed to classify expenses. A second type of earnings management also cited by McVay (2006) and McEnroe (2010) is using their discretionary judgment allowed in GAAP to manipulate real activities. An example of these activities would be to reduce the expenditures on R&D, leading to an increase in the reported income. Such instances indicate that GAAP may make it possible for managers to provide misleading financial statements and thus it fails to offer assurances to the users of financial statements that the statements are a true reflection of the entitys state of affairs.McEnroes opinion that GAAP does not offer assurances to the accuracy of the financial statements is fair even to managers who simply want to follow GAAP. This is because such managers, when not inclined to inflate the performance of the entity, will still adopt a conservative approach under GAAP. By recognizing the weaknesses in GAAP and adopting corrective action, the resultant accountability will safeguard the reputation of the accounting profession. As such, even the managers who are honest in their use of GAAP will benefit from increase in users trust of the statements that the accounting officers prepare.McEnroes observation that auditors are unlikely to use an audit opinion to police bad business practices even if they involve earnings management (2010, p. 65) can be explained by auditors fear of losing business when they offer qualified opinions. A study by Stefanik et al. (2009) for instance found out that clients are likely to switch auditors when the auditors offer a qualified opinion (as cited in Habib, 2013, p. 185). As such, since auditors can still find recourse by arguing that the statements were prepared in accordance with accounting principles espoused by the GAAP, they may be hesitant to provide an opinion that could injure their relationship with the client.I, however, do not agree with the auditors position. This is because by disregarding bad accounting practices, auditors would be escaping from their moral duty to encourage fair reporting by the clients. When auditors offer an unqualified opinion for reports that are subsequently found to be misleading, they stand a risk of damaging their reputation and thus losing the business they were initially trying to preserve (Habib, 2013). Additionally, by assuming their moral duty to offer a statement that indicates the extent to which the financial statements are a representation of the entitys state of affairs, both the auditors and the clients would benefit in the long term. For example, DeFond, Lim and Zang (2012) observe that when auditors encourage clients to be conservative in activities that involve managers discretion, benefits such as lower incidences of accounting restatements, lower audit fees, fewer opinions concerning the going concern status of the entity, and less likelihood for the auditor to resign accrue. Thus, my opinion is that auditors should offer qualified opinions where they encounter imprudent practices to manage earnings during their audits.ReferencesDeFond, M. L., Lim, C. Y., & Zang, Y. (2012). Retrieved from Habib, A. (2013). A meta-analysis of the determinants of modified audit opinion decisions (3), 184-216. Doi:10.1108/02686901311304349McEnroe, J. E. (2010). Public accountants perceptions of the acceptability of earnings management practices through the employment of GAAP in the post-Sox period. (1), 59-72.McVay, S. E. (2006). Earnings management using classification shifting: an examination of core earnings and special items. (3), 501-531.

Topic: ARTICLE REVIEW

Order Description
Article Review
• The review should be written in APA format- double spaced, Times New Roman, 12 font
• There should be a cover page, 2 pages for the review, and a reference page (if you use any references from other articles or your text book, please put them as a reference)
• Assignment will be uploaded to Turn-it-in
*The assignment will not be accepted if the article is over 4 pages to include the cover and the reference page.

The article review should consist of the following five sections:
1. An APA citation of the article you chose at the top of the page.

Ex.
Baber, C. R., Cooper, J. E., Kurtts, S., & Vallecorsa, A. (2008). A model for examining teacher preparation curricula for inclusion. Teacher Education Quarterly, 35(4), 155.
2. Reason for choosing the article (introduction to the review)
Why this one? You can include a personal reaction to the issue/topic and the article itself here.
3. Brief summary of what the article is about
I suggest you write this immediately after reading your article…when it is freshest in your mind. Summaries are difficult for most of us to do…so think of it as your “impression” of what it is about. This is not the place for detail after detail…that’s not a summary. A summary contains a balanced presentation of relevant ideas about the article so that…another person is able to tell what it is about. The suggested length is 1/2…much over a page and you are really beyond summarizing.
4. Assessment of the article
This is the core of the review. I want you to assess the article critically…which doesn’t necessarily mean negatively. “Critically” here means going beyond surface reactions, delving into the why’s of the author’s thoughts and writing. For instance, what did you think of the article…what about the main theses/purposes of the author? How well did the author(s) state and support their position? What do they use to do so? What else do you feel needs to be said or examined besides the points the author(s) made? What relationship did the article have to your area of study? Could this article help you in your line of work?
5. Conclusion of the review
This should be where you wrap it up and no more than a paragraph. Perhaps a final, overall summary of what you read and what more you would like or not like to see about the topic.
PLEASE USE BOOK “EXCEPTIONAL LIVES, SPECIAL EDUCATION IN TODAYS SCHOOLS” BY ANN TURNBULL, RUD TURNBULL, MICHAEL L. WEHMEYER AND KARRIE A SHOGREN