Background of the company Parmalat Finanziaria SpA‚ an Italian food giant started out as a family business specializing in dairy products. It was founded in 1961 by 22 year old Calisto Tanzi‚ who discontinued his studies to expand his father’s sausage and cheese shop. It began as a small pasteurization plant in Parma and further expanded into cheese‚ yoghurt‚ cookies‚ fruit juice and ready-made sauce production that are under different names in each country. They were the ones to produce the world’s
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Case 8-2 Parmalat: Europe’s Enron 1. Review the facts in the case‚ especially the charges in the complaint‚ and evaluate the auditors’ compliance with GAAS. Do you think the auditor did all they could to detect the fraud? Evaluate whether auditors exercised due care and the level of professional skepticism to be expected in an audit the size of Parmalat. Clearly‚ auditors failed to do the due diligence‚ thereby indirectly contributing to the failure of Parmalat. Italian law requires both listed
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Parmalat accounting scandal Which factors were relevant in the Parmalat scandal? Describe the causes and consequences of the scandal. Parmalat scandal is one of biggest fraud in the world‚ for years the company can eluded responsibilities with financial analysts and investors but was in December 2003 when Parmalat went bankrupt. In this summary it can appreciate the most significant events: In 1990‚ Parmalat started buying milk producers around the world‚ in order to hide a huge debt
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SEMESTER V SL. NO COURSE CODE COURSE TITLE L T P C THEORY 1 MC9251 Middleware Technologies 3 0 0 3 2 MC9252 Software Project Management 3 0 0 3 3 E2 Elective II 3 0 0 3 4 E3 Elective III 3 0 0 3 5 E4 Elective IV 3 0 0 3 PRACTICAL 6 MC9254 Middleware Technology Lab 0 0 3 2 7 MC9255 Software Development Lab 0 0 3 2 TOTAL 15 0 6 19 SEMESTER VI SL. NO COURSE CODE COURSE TITLE L T P C PRACTICAL 1 MC9261 Project Work 0 0 24 12 TOTAL 0 0 24 12 Total No of Credits to be earned
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“Europe’s Enron” – the saga that has engulfed Italy’s milk-processing giant Parmalat and its senior executives‚ blue-chip European and American banks‚ accountancy firms‚ politicians and 130‚000 hapless small shareholders following the discovery in 2003 of a $14bn black hole in its finances. The revelation triggered an eight year marathon of court cases in Europe and America‚ the disgrace of the Tanzi family that controlled Parmalat‚ at least one death‚ the collapse into administration of one of Europe’s
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Something Went Sour at Parmalat Parmalat is a multinational Italian dairy food corporation that today represents one of the biggest fraud scandals that has marked history in Europe. What happened and why weren’t the scandalous activities detected beforehand? Parmalat’s investigation was triggered when it “defaulted on a $187 million bond payment in mid-November 2002.” This led to further revelation of the nonexistence of $4 billion worth of claimed bank deposits held by a subsidiary in the Cayman
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Fractionalization and the municipal bond market Daniel Bergstresser* Randolph Cohen** Siddharth Shenai*** (First version April 2010. Current draft June 2011. Comments welcome.) Abstract We study the impact of ethnic and religious fractionalization on the U.S. municipal debt market‚ and find that issuers from more ethnically and religiously fractionalized counties pay higher yields on their municipal debt. A two standard deviation increase in religious fractionalization is associated
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What specific audit procedures might have uncovered the Parmalat fraud earlier? Parmalat went from recording annual sales of 7.6 billion euros in 2002 to being declared insolvent a year later. The collusion at Europe’s Enron made it possible for Parmalat to defraud its investors of billions. The auditing procedures used by Grant Thornton and Deloitte were inadequate. Many of Parmalat’s assets were overstated and its liabilities understated. The auditors did not adequately test the Special Purpose
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Parmalat‚ Europe’s Enron of fraud‚ undermined European accounting and reporting standards. The fraud‚ totaling nearly 18 billion euros‚ brought down the Italian dairy giant and ruined investors across the globe. Such a enormous fraud‚ some would assume‚ would need to be highly complex and fully developed in plan as well as execution. However‚ as Parmalat executives began to cooperate in the investigation‚ it was uncovered how rudimentary their fraud was despite the enormity in which it occurred.
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Managua‚ Nicaragua Sept 28th‚ 2013 ENRON Background In 1985 Kenneth Lay merged his company‚ Houston Natural Gas‚ with Nebraska’s InterNorth to create the Enron; a company to be the biggest natural gass corporation to exist in the U.S. During the 1980’s‚ under the presidency of Ronald Raegan‚ there was a considerable lack of regulations regarding the energy markets‚ thus allowing the company to buy and sell contracts for a delivery at some time in the future. By 1990 Jeffery Skilling joined as
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