Introduction The Music Games International (Hereafter referred to as “MGI”) team comprised of seven (7) members as stated – The group is extremely diverse comprising of the following, Henry Tam and Dana Soiman were final semester students at Harvard Business School (Hereafter referred to as “HBS”) working on the business plan not just for the competition, and as a professional challenge as soon. For the founders, Sasha Gimpelson was known for his unconventional ideas. Igor Tkachenko, an accomplished musician and Roman Yakub, a composer.
Alex Sartakov -introduced to the group through a mutual friend of Igor and Sasha, he had music background, Dav Clark was a MIT graduate had a software background and was also planning to enter the MGI case for the MIT business plan contest. Question 1 What is your evaluation of the MGI’s team process? What were the roots causes of the team’s process problems? In evaluating the team’s process from the four stages of group development as shown at Exhibit 1 are: Forming, Storming, Norming, Performing.
The forming stage in which the founders of MGI looking for someone who could work on doing general management, sales and marketing for their child edutainment products while at the same time, Henry and Dana, the two HBS MBA class students were looking at a company for them to work for The Harvard Business Plan Contest. At this important stage, the team had to start designing the team structure, appointing team leader, developing individual roles, developing thrust and communication, developing norms, defining problems and strategy and identifying information needed.
However, that was never happened and in fact there was something ‘unusual’ at the forming stage in which one of the co-founders, Roman was missing at the first meeting, while Alex was introduced as one of the team member at the second meeting while Dave at the third meeting subsequently. The forming stage was deemed rather ad-hoc and without planning and some time when new members were inducted ad-hoc without the consent of other members (in this case Henry and Dana), it might cause discord and perceived that new members as rivals and tagged along to enjoy the fruits of their labour.
The first meeting held with Igor and Sasha mostly high lightened about MGI’s problem to market their child edutainment products. In the storming stage, things became more complicated, frustration and confusion aroused as well. Henry described the meeting as confrontational stance between him, Dana and the three Russians. At this stage, members supposed to brainstorm on team’s goals and objectives, mutual roles and responsibilities, interpersonal skills, task, communication and decision systems while in this case, that was not happened.
While Henry and Dana perceived themselves as strategic contributors to MGI, the two co-founders perceived otherwise. Sasha and Igor saw both HBS students as interns/lackey that would help MGI to do the company’s business plan, vision and strategy. The storming stage seemed failed to develop two ways communication between the co-founders and both of the HBS students as no brainstorming took place. What happened was so straight forward instruction in which both Henry and Dana were given task by Sasha to contact HBS’s alumni.
In respect of Sasha’s intention to contact the HBS Alumni to further the business strategy was shocking and stunned as it undermine their integrity. Sasha might be thinking that was the HBS students and Dav taking advantage of the business strategy by joining a business competition and boost their average class of their studies. A norming stage is the stage in which team do detailed planning, develop criteria for completion of goals, build up positive norms and values as well as encourage continued team spirit.
The team could further ironed out each goals and what their want out of the business strategy. Perhaps the team should draft the shareholder agreement or even partnership to allocation shares or interest based on the potential outcome. Nothing is free in the life these days; monetary is usually the driving force and motivation to be inspired. An example of how Facebook became very successful and because of that it leads to various lawsuits when suddenly of the bushes many people claimed input and ideas that created the social portal.
It’s always a wise move to discuss and negotiable potential agreement with sound legal advice. As for the norming stage, it was completely blunder since no detail discussion on goals, norms and values took place and no team spirit developed. The norming stage was filled up with unnecessary argumentation and unhealthy conflict between the co-founders and the HBS students while the other two were sitting on the other side.
Failure in this stage thus led to poor team performance as no team leader who has utmost authority identified, no clear goal as to win the HBS Business Plan Competition or market MGI’s products successfully defined and the status of both Henry and Dana, whether they were business partners or interns/lackeys was also not decided. They team was no different to a ship with no admiral and no direction to go. To be honest once read and analyze the case study, it is obvious that there was no cohesion, not only as a group overall, but even within a splinter teams.
It seems that Roman was disagreeing within the Soviet splinter group and the HBS students disagreeing with Sasha and it was vice-versa. Negative related issue related to low helping behaviour. The HSB students also felt that the brainstorming were far too lengthy and not effective at all. The norms were obviously not defined and agreeable by all team members, no decision-making and different task orientation hence the development of the business plan was too slow.
Review Of The Movie “Liar Liar”
“Liar Liar” is a comedic film that follows the life of Fletcher Reede, a dedicated lawyer and father who has gone through a divorce. Portrayed by Jim Carey, Fletcher resides in Los Angeles, California, where he grapples with his habit of compulsive lying and how it affects him. The movie delves into Fletcher’s challenging dynamic with his son Max and ex-wife Audrey, which ultimately leads to their unfortunate divorce and search for new relationships.
Fletcher Reede, the main character in the movie, is no longer married to Audrey Reede. A highly successful lawyer, Fletcher prioritizes his career and distorts the truth for his own benefit. Although he cherishes spending time with his son Max, Fletcher has difficulties being on time and telling the truth. Sadly, he even skipped Max’s birthday celebration because he was involved in a sexual encounter with his boss Miranda.
Throughout this movie, there are numerous instances of deceit, including equivocation, exaggeration, lies, falsification, and omission. When considering lying as a distortion of the truth regardless of intention, it becomes clear that deception is a regular occurrence in daily social interactions. In the film, Fletcher is portrayed as a highly skilled and persistent liar. He effectively utilizes his compulsive lying talent to become a popular and successful attorney. Due to his reputation, the people of Los Angeles specifically seek him out to represent them as their attorney in court.
For instance, Fletcher’s continuous lying presents him with an extraordinary chance that could greatly advance his career. This opportunity requires him to utilize his skills as a defense attorney in a significant divorce case. Despite Samantha Cole, his client, being excessively driven by money and clearly unsuitable as a mother for her children, Fletcher stubbornly insisted on employing his expertise in deceit to secure a victory for Samantha against the opposing party. However, this was contingent on certain conditions being met.
A few days earlier, Fletcher was absent from Max’s birthday celebration, causing Max to make a wish for his father to become incapable of lying. Now, Fletcher finds himself in a difficult situation as he is unable to tell lies, which poses serious challenges in court while trying to defend Samantha Cole. Fletcher’s conduct during the court proceedings transformed his life for the better. Max’s wish resulted in the improvement of his father’s character on that particular day, which slowly became apparent to Fletcher. In an attempt to navigate this predicament, Fletcher relied heavily on omission as a means of deception, selectively leaving out significant details about the case that he wanted to disclose but couldn’t due to his inability to lie.
For instance, Fletcher frequently exited the court room to evade questioning by the judge. If he had been honest with the judge, Fletcher and Samantha would have been unsuccessful in their case. Throughout the movie, Fletcher engaged in exaggeration, a deceitful tactic that involves magnifying or overstating facts. He also employed equivocation, which entails providing vague or ambiguous responses to create the illusion of having answered a question, as he was unable to tell lies.
Fletcher made several attempts to delay the case, such as hurting himself and giving excuses to the judge. However, he couldn’t bring himself to lie, so the case was not dismissed but only postponed. Later, when questioned about the person who assaulted him, Fletcher chose honesty and confessed that he had done it to himself. Ironically, Fletcher had no problem lying in the past, but he became angry at Samantha, his client, for exaggerating and falsifying her age. This made him realize that Samantha had lied, thus invalidating her signature on the prenuptial agreement.
This passage describes acts of dissimulation, which involve deceiving others by omitting crucial details that would alter the narrative. Audrey, the narrator’s ex-wife, is astonished by how much he has changed. She no longer believes his promises or statements. However, their son Max insists that his father is incapable of lying because he made a wish on his birthday for his dad to always be truthful. Audrey plans to leave Fletcher behind in Boston to escape his constant disappointments and lies and start afresh with their son.
Fletcher recognized a change within himself and was determined to demonstrate this transformation to Audrey and Max. Consequently, Fletcher caught up with Audrey and Max, persuading them not to proceed with their trip to Boston and granting him another opportunity to be a father. Whether or not lying is acceptable depends on one’s profession. In the realm of criminal justice, it is common for individuals to be trained to use deception. Attorneys often resort to exaggeration and falsehoods in order to secure favorable outcomes for their cases and receive higher compensation.
Provision Of Services Or Other Activities
What is the authoritative literature addressing revenue recognition when right of return exists? If a transaction is within the scope of specific authoritative literature that provides revenue recognition guidance, that literature should be applied. However, in the absence of authoritative literature addressing a specific arrangement or a specific industry, the staff will consider the existing authoritative accounting standards as well as the broad revenue recognition criteria specified in the FASB’s conceptual framework that contain basic guidelines for revenue recognition.
Based on these guidelines, revenue should not be recognized until it is realized or realizable and earned. (FASB ASC 605-10-25-3; FASB ASC 605-10-25-5)Recognition and Measurement in Financial Statements of Business Enterprises, paragraph 83(b) states that “an entity’s revenue-earning activities involve delivering or producing goods, rendering services, or other activities that constitute its ongoing major or central operations, and revenues are considered to have been earned when the entity has substantially accomplished what it must do to be entitled to the benefits represented by the revenues”.
Paragraph 84(a) continues “the two conditions (being realized or realizable and being earned) are usually met by the time product or merchandise is delivered or services are rendered to customers, and revenues from manufacturing and selling activities and gains and losses from sales of other assets are commonly recognized at time of sale (usually meaning delivery)” In addition, paragraph 84(d) states that “If services are rendered or rights to use assets extend continuously over time (for example, interest or rent), reliable measures based on contractual prices established in advance are commonly available, and revenues may be recognized as earned as time passes. “
What is meant by “right of return”? Right of return(FASB ASC 605-15-05-3) option of purchaser to give goods back to the seller for full credit. The buyer’s right to return merchandise precludes revenue recognition by the seller at the time of sale unless all of the following conditions are met:
- selling price is determinable;
- buyer’s obligation to pay is not contingent on resale of the product;
- buyer must pay for item if lost;
- acquisition by buyer has economic substance;
- future performance by seller is not required for resale by buyer;
- future returns may be reasonably estimated. If these conditions are not satisfied, revenue and related expenses must be deferred until the conditions are met or the right of return has expired.
When there is a right of return, what conditions must the company meet to recognize the revenue at the time of sale? Sales return and allowances In most industries are may not material ,so that companies typically record them at the time of the return or allowance. ( FASB ASC 605-15-25-1) In some industries, such as book publishing the right of return is common and the amounts may be material. In these case, credit ‘sales’ in one period may be followed by substantial returns in another. These factors create a revenue recognition issue for the selling company because sometimes it cannot make reliable estimates of ferred to the buyer. As a result, GAAP identifies criteria for recording sales revenue when the right of return exists.
For a seller to recognize revenue at the time of sale, each of the following criteria must be satisfied when the right of return exists. If they are not, then the seller must defer revenue recognition.
- people need to know the price on which date they sell it.
- the buyer has paid or will pay the seller, and the obligation is not contingent upon resale of the product.
- the buyer’s obligation to the seller would not be changed by theft or damage to the product.
- the buyer has an economic substance apart from the seller.
- the seller does not have significant obligations to help the buyer sell the product.
- the seller can reasonably estimate the amount of future returns.
If a company defers recognizing sales revenue and cost of goods sold because one or more of these conditions are not met, it records the sales revenue and cost of goods sold either when the return privilege expires or when the conditions are met, whichever occurs first. (d)What factors may impair the ability to make a reasonable estimate of future returns? Many factors will affect the ability to make a reasonable estimate of the amount of future returns (FASB 605-15-25-3 ) and every case may be has different circumstance. However, the following factors may impair the ability to make a reasonable estimate:
- The significant external factors of the products, such as technological obsolescence or changes in demand
- In a long periods, a particular product may be returned
- Absence of historical experience with which products they had never sold, or they have less experience for sell it because of changing circumstances, for example, selling enterprise’s marketing policies or relationships with its customers has some changes.
- they are lack of a large number of relatively homogeneous transactions
The existence of one or more of the above factors, in light of the significance of other factors, may not be sufficient to prevent making a reasonable estimate; likewise, other factors may preclude a reasonable estimate. (FASB ASC 605-15-25-4) When the right of return exists, company should recognize revenue at the time of sale on above circumstances. And some factors, such as changes in damages and long period, have the ability to reduce the possibility to do a reasonable estimate of future returns.