Accounting firms use different accounting procedures however, cases of primary complaints based on some valid reasons that the audit committees readily address. These complaints include those of fraud against investors through fraudulent statements to Securities and Exchange Commission (SEC) and the investing public significantly through deviation from giving a full and fair reporting based on the company’s financial condition. In addition, lack of compliance with the rules and regulations set by SEC and other laws applicable in terms of proper maintenance of financial books and records, internal accounting controls and audit of financial statements calls for either employee or third party complaint. Deliberate error in the preparation, evaluation, and audit of a financial statement besides intentional noncompliance to internal accounting controls could lead to valid complaints against the company.
Fraudulent actions give a false perception of the company’s financial position as the view given based on the financial information is biased and misleading. As a result, companies that use false accounting procedures lead to investors’ poor evaluation and decision making as they are given a false picture of the financial position of the company therefore, they invest their money. Investors lose their funds as employees are rendered jobless due to the closure of the business as the fraudulent management loot funds (Nicholson & Snyder, 2008).
Balancing capacity is a strategy of ensuring that there is efficient planning of the requirements of production. However, the use of balancing capacity is not easy as it entails solving of the production problem using a lot of sophisticated algorithmic solutions. Nonetheless, the successful evaluations of the balancing capacity problem there arise from a difficulty in matching demand and capacity (Portougal & Sundaram, 2006). This is because there is a natural tendency that the capacity is lower than demand thus, the capacity is lifted, and if the capacity is over demand the capacity has to be reduced thus, it is hard to achieve a level of balance.