IDCC 320 – Assignment Two

Explaining a Technical Concept or Management Issue

Situation
For this assignment, establish a situation in which your readers require a well-developed explanation of a concept in order to carry out a task, solve a problem, or make a decision.  To present your definition/explanation effectively, you will need to prepare what is called an extended definition of the accounting, financial, management, communication, or marketing concept (or issue) you have selected.  In an extended definition, your explanation is expanded by using a variety of techniques appropriate to your audience and to the business situation that brought the need for a formal explanation of the concept.

In accounting information systems, for example, a user may request a service from system designers or administrators and not understand an important system design principle or programming concept that pertains to what they want done.  Changes in tax laws may need to be interpreted and explained to clients assessing their tax situation.  Concepts such as FIFO and LIFO affect decisions governing inventory management and taxation.  In financial accounting, the concept may be a new strategy for measuring return on investment or a training principle related to the use of such enterprise-wide IT tools as SAP.  In more dramatic situations, you may need to determine whether a firm has “cooked the books.”  You may need to explain a monetary policy, an economic principle, an SEC ruling, or an investment strategy to a wide range of audiences, inside and outside your company.  Maybe a client or an internal user of accounting information does not fully understand the distinctions made between various categories of assets (e.g., fixed, intangible, capital, etc.).

Choose a concept from your major and simulate (or perhaps recreate) a business situation that requires a fairly detailed explanation of that concept.  (I can help you form a realistic business situation if you wish) You might recall a situation at work or an incident that occurred during your internship in which people were confused by undefined or badly defined concepts.  Your objective is to either prevent miscommunication from affecting a business decision or task, or your objective is to correct an on-going misunderstanding of some kind, such as various misconceptions people have about the audit process or venture capital.

Expansion Techniques
Begin your explanation with a formal (Aristotelian) definition.  A formal definition takes a concept or principle, assigns it to a genus (class or category), and then differentiates that concept or principle from other members in its class.

Example
A pencil [the term] is [the = sign] a writing instrument [the genus or class] that is composed of a thin graphite rod surrounded by a wooden sheath [the difference between a pencil and all other members of the class “writing instruments.”]

Or the following variation on the above formula:
Accounting [genus or class] encompasses various types of accounting, such as asset accounting, cost accounting, estate accounting, and financial accounting.
Current assets [genus or class] include cash, notes receivable, accounts receivable, and prepaid expenses.
Investor Relations is the communications arm of corporate finance responsible for marketing the corporation as an investment and reducing the cost of acquiring capital.

Other Techniques
Explication —             defines key words in a formal definition

Financial accounting is “activity associated with the development and                         communication of financial information for external users, primarily in the form                 of general purpose financial statements.”

Operational definition —         demonstrates where the term or concept might be observed

Manufacturers employ the cost-accounting system, which is “the perpetual                     system of inventory accounting for the three inventories: direct materials, work                     in process, and finished goods.”

An analysis —             separates a whole into its component parts

Five classifications of accounts (assets, liabilities, owner’s equity, revenue, and                     expenses) comprise a general ledger (a chart of accounts).

An example (exemplification)    uses one member of a class to convey an impression of the entire class.

•    Labor and materials are examples of costs of sales
•    “Deposits that are not immediately available due to withdrawal or other restrictions are sometimes referred to as time deposits.  These deposits are often separately classified as ‘restricted cash’ or ‘temporary investments.’ Examples of time deposits include certificates of deposit (CDs) and money market savings certificates.  CDs, for example, generally may be withdrawn without penalty only at specified maturity dates.”

Other rhetorical strategies for expanding the definition include:
•    cause-effect analysis
•    process analysis
•    comparison-contrast
•    analogy
•    negation (also known as elimination)
•    metaphor
•    simile
•    etymology
•    history

Further Details on the Assignment
Structure your paper as a memorandum addressed to a non-accountant reader.  Your document will have the following structure:

Heading
To, From, Subj, Date

Executive Summary
Problem/purpose statement
Overview of results, conclusions and recommendations

Discussion
Formal Definition
Various expansion techniques (labeled in margins)
Conclusions/recommendations (in detail)