Parmalat
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. The company began to issue bonds to generate cash, also conducted fraudulent accounting practices in the following years.
In December 2003, Parmalat failed to pay a bond for $ 150 million. This event alarmed the market. Following this event was to initiate an investigation in order to see what was going on Parmalat.
This essay will focus on evaluating a number of articles mentioned in the references, in order to specify what were the causes and major consequences in this known fraud.
First of all, the accounting point of view, this fraud occurs by the necessity of the owners and managers of company to show the world that his company was profitable and was still totally being a company with profits. Different types of accounting fraud are made in the company recorded assets (purchases of milk producers) in order to show that assets were much greater than its liabilities. In this way the company showed solid in the financial statements.
Then this paper has mentioned consequences that brought over 9 years of trials. In December 2003, the bondholders learn that funds for more than $ 4 billion in the Bank of America are non-existent. The bank said that the transfer document is a forgery. Accounting firms are stained with the word fraud. It is found that the real debt of the company was 10 times more than that the company had registered. These are the main events in a series of that genre consequences this giant fraud.
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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. The company began to issue bonds to generate cash, also conducted fraudulent accounting practices in the following years.
In December 2003, Parmalat failed to pay a bond for $ 150 million. This event alarmed the market. Following this event was to initiate an investigation in order to see what was going on Parmalat.
This essay will focus on evaluating a number of articles mentioned in the references, in order to specify what were the causes and major consequences in this known fraud.
First of all, the accounting point of view, this fraud occurs by the necessity of the owners and managers of company to show the world that his company was profitable and was still totally being a company with profits. Different types of accounting fraud are made in the company recorded assets (purchases of milk producers) in order to show that assets were much greater than its liabilities. In this way the company showed solid in the financial statements.
Then this paper has mentioned consequences that brought over 9 years of trials. In December 2003, the bondholders learn that funds for more than $ 4 billion in the Bank of America are non-existent. The bank said that the transfer document is a forgery. Accounting firms are stained with the word fraud. It is found that the real debt of the company was 10 times more than that the company had registered. These are the main events in a series of that genre consequences this giant fraud.
.