WorldCom Ethical Scandal In the late 1990’s‚ WorldCom was a successful company and leader in the telecommunications world. They had merged with MCI and the company was regarded for being innovative and growth hungry. However‚ in the midst of all the mergers WorldCom CEO Bernard Ebberly began to mismanage the company. WorldCom was no longer meeting their numbers and it looked like stock prices would fall. Rather than letting this happen‚ executives at WorldCom doctored the books. CFO Scott
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7/22/13 WorldCom Search » Ethics Home Page About the Center Focus Areas Bioethics Business Ethics Campus Ethics Character Education Government Ethics Internet Ethics More... Publications Ethics Articles Ethics Cases Ethical Decision Making Videos Ethics Blogs Podcasts E-letter/Subscribe Contact Us Site Index WorldCom1 By Dennis Moberg (Santa Clara University) and Edward Romar (University of MassachusettsBoston) An update for this case is available. 2002 saw an unprecedented number of
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Accounting Fraud at WolrdCom Introduction WorldCom‚ US second largest telecommunication company shocked the world by filing bankruptcy at 21 July 2002. The WorldCom filing surpassed Enron and became the largest bankruptcy filing in United States history. Due to its rapid growth‚ WorldCom is also heavily in debt as they finance the company growth with debt. The collapse of WorldCom did not just affect their employees‚ retailers‚ the government but also bankers. WorldCom was a multi-billion dollar telecommunications
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The Cosmic Microwave Background Radiation Perhaps the most conclusive (and certainly among the most carefully examined) piece of evidence for the Big Bang is the existence of an isotropic radiation bath that permeates the entire Universe known as the "cosmic microwave background" (CMB). The word "isotropic" means the same in all directions; the degree of anisotropy of the CMB is about one part in a thousand. In 1965‚ two young radio astronomers‚ Arno Penzias and Robert Wilson‚ almost accidentally
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Cosmic Microwave Background Radiation The Big Bang theory predicts that the early universe was a very hot place and that as it expands‚ the gas within it cools. Thus the universe should be filled with radiation that is literally the remnant heat left over from the Big Bang‚ called the “cosmic microwave background radiation”‚ or CMB. The CMB is an almost-uniform background of radio waves that fill the universe. The CMB is‚ in effect‚ the leftover heat of the Big Bang itself - it was released when
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Corporate Governance WorldCom Scam Introduction MCI WorldCom was one of the largest telecommunications companies in the world. Bernie Ebbers founded WorldCom in 1983‚ after that WorldCom began as a re-seller of long-distance telephone services. WorldCom is located at Mississippi. After Ebbers bought around 50 other small long-distance firms‚ he set his sight on MCI. Thus MCI WorldCom would have become the second biggest telecom service provider in 1997. MCI WorldCom was formed on September-15-1998
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3) Roots of the scandal The roots of the fraud and the role of internal auditors As explained above‚ the fraud was implemented by the former CEO Bernard Ebbers and commited by his financial director Scott D. Sullivan. The technique used by Worldcom was pretty simple; indeed‚ he cooked the books by saving pure operating expenses such as maintenance network in capital expenditure instead of expenses in order to hide its decreasing earnings and to maintain the price of Worldcom’s stock. In summary
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Examining a Business Failure: WorldCom WorldCom was one of several large companies that failed because of inadequate organizational leadership‚ fraud‚ conspiracy‚ falsifying documents‚ and embezzlement. WorldCom has been classified as being “one of the biggest corporate scandals in Unites States history” (Zekany‚ 2004‚ p. 101). In 2001‚ the company’s financial condition began to decline due to the slowing telecommunications industry‚ which eventually put pressure on the company’s executive
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fraudulent accounting practices that led to the collapse of Worldcom. Other objectives of this paper will be to demonstrate how these activities were able to go undetected. Also‚ what motives drove the individuals involved to commit these acts. And finally the ethical accounting issues involved. Worldcom got its start as a small discount long distance provider in Mississippi. Founded by Bernard Ebbers and a number of others the idea for Worldcom was simple‚ buy long distance services from larger companies
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The WorldCom Fraud © 2003‚ 2005 by the AICPA This presentation is intended for use in higher education for instructional purposes only‚ and is not for application in practice. Permission is granted to classroom instructors to photocopy this document for classroom teaching purposes only. All other rights are reserved. Copyright © 2003‚ 2005 by the American Institute of Certified Public Accountants‚ Inc.‚ New York‚ New York. WorldCom’s Background • Awoke the sleeping giant by leading the telecom
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