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Contents

1

Introduction. 2

Comments on the First Post. 2

Comments on the Second Post. 2

Comments on the Third Post. 3

References. 4

Introduction

Comments on the First Post

This post provides an excellent explanation of how the Toyota recall affected stockholders of the company. It is true that the confidence of stockholders was negatively affected by the recall (Gokhale, Brooks & Tremblay, 2014). The post also explains well the idea that the company’s top managers also suffered a damaged reputation following concerns that they did not handle the accelerator problem well, necessitating the recall.

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            Regarding the issue of corporate governance, the post seems to exonerate Toyota from allegations of poor handling of business risk control. In my view, Toyota was at fault in terms of the way it used corporate governance to hand the accelerator problem in some of its cars. Nevertheless, as the post states, problems can occur in companies that have established reputable brands. The post indicates, and truthfully so, that Toyota performed well in terms of rebuilding consumers’ and stakeholders’ confidence (Bloch, 2014).

Comments on the Second Post

            In this post, the writer provided crucial insights into the nature of rules in managerial accounting vis-à-vis those of financial accounting. The rationale that the classmate provides for these differences are valid. For instance, I agree with his view that one of the reasons for the lack of rigidity in the rules in managerial accounting is that the accounting records generated are not meant for formal reporting to external stakeholders. I also concur with him that ethics and confidentiality must be put into consideration in both financial and managerial accounting. The post generally provides an excellent appraisal of ethical and confidentiality standards expected of professionals in both managerial and financial accounting and how interactions between them can contribute to these standards.

Comments on the Third Post

            The post makes a good attempt to answer the two questions. The only main problem is that in the first answer, the classmate’s explanation somewhat lack clarity. It identifies consumers as the primary stakeholder who was negatively affected by the Toyota problem, and this is fine (Liker & Ogden, 2011). However, it is not clear what the classmate is trying to say about the controversy revolving around Toyota’s alleged prior awareness of the existence of the accelerator pedal problem and its subsequent failure to alert federal authorities for fear of causing panic among consumers.

            The post answers the second question fairly well. It identifies corporate governance as the foundation of any company. It also highlights the role of top management in promoting corporate governance. I agree with the classmate’s view that most of the quality problems that affect companies now and then may be attributed to laxity on the part of top management.

References

Bloch, O. (2014). Corporate Identity and Crisis Response Strategies: Challenges and Opportunities of Communication in Times of Crisis. Dresden: Springer Fachmedien Wiesbaden.

Gokhale, J., Brooks, R. & Tremblay, V. (2014). The effect on stockholder wealth of product recalls and government action: The case of Toyota’s accelerator pedal recall. The Quarterly Review of Economics and Finance, 54(4), 521–528.

Liker, J. & Ogden, T. (2011). Toyota under Fire: Lessons for Turning Crisis into Opportunity. London. The McGraw-Hill Companies, Inc.