operations capabilities so they can achieve a high set of goals and objectives and to gain bigger market share than their competitors at all the times. Such cases happened in the past with several companies such as Enron‚ WorldCom and others. In such scandals‚ the CEOs were accused of conducting illegal actions and unethical behaviors. Health South: The Scrushy Way Richard M. Scrushy‚ the former CEO of HealthSouth Corporation which owns a chain of hospitals and clinics‚ benefitted from some of the
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almost $16.2 billion over a 15 year period‚ leading the company into a $9.2 billion bankruptcy. Grant Thornton‚ the auditor at the time of the events‚ was replaced by Deloitte & Touche Tohmatsu‚ claiming to be a victim of deceit in the Parmalat audit scandals. ii. Adelphia (2002) - Deloitte & Touche Tohmatsu Adelphia Communications was under Pennsylvania and New York federal grand jury‚ and SEC investigations for making off-balance-sheet loans‚ amounting to $3.1 billion‚ to the founders and former
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occupational medical services. The company experienced rapid financial growth and numerous mergers and acquisitions in the mid-1990s‚ which continued to escalate until the fraudulent activity surfaced in 2002. It was at this time that the Enron and WorldCom scandals were discovered and the Sarbanes-Oxley Act was created. Pressure to meet Wall Street expectations pushed Scrushy and other senior management to “cook the books”. Income was artificially inflated‚ numbers were manipulated‚ and false accounts were
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Expectation Gap and Corporate Fraud: Is Public Opinion Reconcilable with Auditors’ Duties? Jeffrey Cohena‚ Yuan Dingb‚ Cédric Lesagec‚* and Hervé Stolowyc b Carroll School of Management at Boston College‚ USA China-Europe International Business School (CEIBS)‚ Shanghai‚ China c HEC Paris‚ France a This draft – October 28‚ 2010 – Please do not cite or circulate without permission – Comments welcome Acknowledgments. Cédric Lesage and Hervé Stolowy acknowledge the financial support of the
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the fact that David Myers’ superior‚ Scott Sullivan‚ asked him to make the false accounting entries in WorldCom’s Accounting records diminish Myers’ responsibility for his improper conduct? Defend your answer. I don’t think David Myers’ responsibility for improper conduct diminishes even he is asked by his superior‚ Scott Sullivan. Scott Sullivan has his own fraud because he agreed and goes along with false accounting entries that eventually become part of an 11 billion fraud. Scott will get his punishment
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trouble by announcing a huge third-quarter loss of $618 million. On October 22‚ 2001‚ the Securities and Exchange Commission (SEC) began an inquiry into Enron’s accounting practices and later that year the company filed for Bankruptcy. Key investigations revealed many shortcomings which include the use of complex & dubious accounting schemes to reduce Enron’s tax payments; to inflate Enron’s income and profits; to inflate Enron’s stock price and credit rating; to hide losses in off-balance-sheet
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transcontinental railroad. The company took part in complex arrangements in which a several of the partners contracted with themselves for the construction of the railroad. As a result of this scandal‚ Credit Mobilier stocks paid dividends of three-hundred and forty-eight percent in the first year (Hoops 59). The real scandal took place not in the west‚ but in the House of Representatives‚ where Oakes Ames "sold" stock at par value to "where they will do the most good (McPherson 585)." In the investigation
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usatodaycollege.com Accounting fraud Part II: The results “Creative accounting” is not a new technique‚ but it can certainly be a costly one. Businesses feel the pressure to appear profitable in order to attract investors and resources‚ but deceptive or fraudulent accounting practices often lead to drastic consequences. Are these so-called creative practices always illegal or can they ever be justified? This case study will present examples of companies who have used inappropriate accounting practices‚
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in Mississippi. The later location of WorldCom’s headquarters‚ Clinton‚ Georgia‚ had been the same small town where her and her husband had gone to high school. She then went on to Mississippi State University to obtain a bachelor of science in accounting and then a master of science in accountancy from University of Alabama. She became a highly qualified accountant after working at both PricewaterhouseCoopers and Deloitte & Touche in Atlanta. In addition‚ becoming a Certified Public Accountant (CPA)
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COMSATS INSTITUTE OF INFORMATION TECHNOLOGY CORPORATE GOVERNANCE : ACCOUNTING SCANDAL SUBMITTED To : Sir. Javaid Zafar Submitted by : Sana Munir MBO - II CORPORATE GOVERNANCE TABLE OF CONTENTS 1 COMPANY INTRODUCTION AND HISTORY................................... ...3 2 CORPORATE BUSINESS ACTIVITIES..............................................6 2.1 Rehabilitation Hospitals.................................................................6 2.2 Outpatient Therapy Services.....
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