Auditing Theory and Practice Case 1 WorldCom: A Focus on Professional Responsibility Prepared by: EL Ahmadi Med Reda Worked With: Ibtihal Slassi Fall 2013 1- Auditor independence refers to the disinterest from the internal and external parties that could influence the professional judgment of an auditor. In other words‚ auditor independence is the lack of any interest that may create a threat or a risk of material bias regarding the reliability of the financial statement
Premium Financial audit Auditing Audit
inappropriate accounting practices. Enron‚ WorldCom‚ Tyco‚ HealthSouth and Adelphia were selected for analysis because of the availability of information regarding specific events occured before‚ during and after the fraud period as well as the ethical issues involved . There is abundant literature presented on the Enron and WorldCom scandal. Tyco‚ Adelphia‚ and HealthSouth were selected to expand and support the information available in the WorldCom and Enron cases. Throughout the research process
Premium Enron Accounting scandals Fraud
Levels of Planning Many times we think of planning as one function of management with no variety. Any time you are looking to the future you are just planning. Throughout this week ’s readings‚ the class has learned that there are actually four levels of planning. These levels include: strategic‚ tactical‚ operational‚ and contingency planning. Each level has a different purpose and impact on the planning process. In the following paragraphs‚ we are going to describe three of the four levels of
Free Gas turbine World Wide Web
Analysis of each company and provides recommendations for investors. Introduction This report will look at: • The unethical behaviour about WorldCom accounting scandal • The Monopolistic competition about china telecom • The overcharging behaviour of AT&T • Recommendations for telecommunication industry • Conclusion Findings WorldCom WorldCom‚ The America’s second-biggest long distance phone company. From 1999 to 2002‚ an internal audit had reported that $3.3 billion in profits were
Premium Monopoly
Table of contents: 1. Introduction ---------------------------------------------------------------------------------- -2- 2. The first effect: accountants responsibility increase * Special sections of SOX that increase accountants responsibility by imposing criminal liability------------------------------------------------------------------------------------------ -3- * Accountants independence resulting in a higher responsibility of accountants------- -4- * Fraud decrease
Premium Internal control Enron Auditing
US telecommunications giant‚ WorldCom during the 1990s that led to its eventual bankruptcy. The case provides a detailed description of the growth of WorldCom over the years through its policy of mergers and acquisitions. The case explains the nature of the US telecommunications market‚ highlighting the circumstances that put immense pressure on companies to project a healthy financial position at all times. The case provides an insight into the ways by which WorldCom manipulated its financial statements
Premium Mergers and acquisitions Finance International Financial Reporting Standards
Enron’s Questionable Transactions 1. The special purpose entities (SPEs) got Enron into trouble. 2. It is debatable whether Enron’s directors knew how profits were being made through the SPEs. Speculation is that they did have knowledge‚ but did not question the questionable procedures. Evidence that indicates the directors knew how profits were being made includes the following: • Andrew Fastow’s role in establishing the SPEs and falsely creating 3% independent investors in
Premium Enron Enron scandal
On March15 2002 the former WorldCom chief “Bernie Ebbers” was sentenced to 25 years in prison for orchestrating an $11 billion fraud at the high-flying telecoms company which resulted in 17 thousand employees losing their jobs and witnessed the vaporization of there pension money so
Premium Ethics Immanuel Kant Philosophy
Arthur Andersen was in charge for the accounting records of several companies including Enron‚ WorldCom‚ and Waste Management. By early 2002‚ they had been charged of falsely auditing books for all three companies. The business revenue from these clients was more important than the ethical decision‚ so they managed to provide misleading information for several years. Waste Management‚ Enron and WorldCom all wanted to show higher profits to meet Wall Street expectations and therefore overstated cash
Premium Arthur Andersen Accounting scandals Enron scandal
Table of Contents Executive Summary 3 Introduction……………………………………………………………………………………………4 Agency Theory and Relevant Hypotheses 5 ABC Learning Centres Limited - Australia 7 Olympus Corporation - Japan ……………………………………………………………………..10 WorldCom Incorporated - United States of America…………………………………………… 13 Conclusion 16 Reference List…………………………………………………………………………………….…17 Executive Summary “An analysis of corporate collapses” is a report that discusses the concept of Agency Theory
Premium Corporate governance Board of directors Financial statements