WorldCom
CASE NAME: WorldCom: Keeping Planes In the Air
1. Briefly describe the important aspects of the situation.
WorldCom had asked its accountant to make accounting entries dipping into reserves to help the company to meet its earnings target.
WorldCom had been done these financial reserves for three quarters and intended to do so thereafter.
The telecommunications industry was in a severe slump.
WorldCom had a slow growth and rising cost.
Vinson, who had done WorldCom’s accounting reserves, did not judge this action logical anymore. And she had no one to argue about this unethical action due to the fact that the CFO of WorldCom thought this could be justifiable.
WorldCom’s outside accounting consultant known WorldCom ‘s actions and alliance with it.
After KPMG took over the auditing of WorldCom, its action was finally get disclosed.
2. What is/are the ethical issue or issues?
Did Cooper’s action considered as a whistle blowing?
Sullivan involved in a intimidation due to the fact that he tried to threat and stop what cooper was doing to find out the truth.
WorldCom as a whole may considered to fraud the public, ie) the wall street journal
3. What are the relevant non-ethical (including law and codes of ethics) issues in the situation?
The issues in terms of how companies should choose and imply their accounting bookkeeping system.
The industry was in a slump and WorldCom’s share price was facing problem.
As mentioned by Vinson, the entries she was asked to complete is out of logic while the CFO still insisted to do so
4. Who are the relevant stakeholders? What are their interests in relation to the situation?
WorldCom management leaders, ie) CFA – this group of people intend to reserves company’s accounting entries in order to make a better look of the company’s revenue as well as decrease the line-cost.
Andersen partners that responsible for the WorldCom account, evidence such as the company brushed Copper off
1. Briefly describe the important aspects of the situation.
WorldCom had asked its accountant to make accounting entries dipping into reserves to help the company to meet its earnings target.
WorldCom had been done these financial reserves for three quarters and intended to do so thereafter.
The telecommunications industry was in a severe slump.
WorldCom had a slow growth and rising cost.
Vinson, who had done WorldCom’s accounting reserves, did not judge this action logical anymore. And she had no one to argue about this unethical action due to the fact that the CFO of WorldCom thought this could be justifiable.
WorldCom’s outside accounting consultant known WorldCom ‘s actions and alliance with it.
After KPMG took over the auditing of WorldCom, its action was finally get disclosed.
2. What is/are the ethical issue or issues?
Did Cooper’s action considered as a whistle blowing?
Sullivan involved in a intimidation due to the fact that he tried to threat and stop what cooper was doing to find out the truth.
WorldCom as a whole may considered to fraud the public, ie) the wall street journal
3. What are the relevant non-ethical (including law and codes of ethics) issues in the situation?
The issues in terms of how companies should choose and imply their accounting bookkeeping system.
The industry was in a slump and WorldCom’s share price was facing problem.
As mentioned by Vinson, the entries she was asked to complete is out of logic while the CFO still insisted to do so
4. Who are the relevant stakeholders? What are their interests in relation to the situation?
WorldCom management leaders, ie) CFA – this group of people intend to reserves company’s accounting entries in order to make a better look of the company’s revenue as well as decrease the line-cost.
Andersen partners that responsible for the WorldCom account, evidence such as the company brushed Copper off