fixed-rate leases for network capacity WorldCom initiated in order to meet the anticipated increase in customer demand. And as later the demand was not as expected‚ the Company has to pay for the leases that were substantially underutilized to avoid punitive termination provisions. The line costs that WorldCom capitalized were ongoing‚ operating expenses that accounting rules required WorldCom to recognize immediately. Instead of expense the cost currently‚ WorldCom capitalized it to exaggerate its pre-tax
Premium Asset Depreciation Generally Accepted Accounting Principles
Excello Telecommunication Donna Snead ETH/376 Susan Paris Monday 23‚ 2015 Excello Telecommunication had seen many years of profitable sales. But‚ then in 2010 Excello had seen a drop of sales due to competition of their product by overseas manufactures. With all the years that this company had been in business they were now faced with the fact that their earnings estimates were not going to be met. There were many executive managers that were worried about the kind of effect this would have on
Premium Generally Accepted Accounting Principles Enron Financial statements
Business Ethics Doug Donofrio FIN/486 May 27‚ 2013 Mary Corcutt Eron and WorldCom are both companies that collapsed due to ethical violations. The major factors that lead to the dissolution of Enron Corporations and WorldCom will be indentified. The specific ethical violations in accounting practices at these two companies will be explained and the role of business ethics in strategic financial planning will be described. “Business Ethics are the standards of conduct or moral judgment that
Premium Enron
Report February 24‚ 2011 By Patrick Mills Introduction- Hormones are a chemical are transported within an organism and are highly specific chemical signals between cells. The hormones we used were lanolin‚ auxins(IAA)‚ cytokinins(CYT)‚ ethylene(ETH)‚ and gibberellins(GA) and each has a different purpose. Auxins will control cell elongation‚ cytokinins promote the act of cell division‚ ethylene causes the ripening of fruit‚ and gibberellins will elongate plant stems. “Leaf abscission or the loss
Premium Leaf Plant morphology Fern
publically traded companies. Every week brought different news on misrepresentations at major American corporations and financial institutions. As soon as the report of accounting fraud at Enron reached public‚ media revealed similar scandals at WorldCom‚ Tyco and number of other publically traded companies. Improper revenue recognition‚ incorrectly recorded expenses‚ and other practices to manipulate financial statements along with briberies to auditors for covering the fraud caused the biggest
Premium Enron
users. In 2002‚ WorldCom a telecommunication company‚ filed for bankruptcy. It was later revealed that the company was involved with improper accounting in two major forms. First WorldCom inflated revenues to increase profits‚ thereby increasing stock prices‚ and increasing the satisfaction of stakeholders. Second‚ the company understated line costs. Revenue is important to users of financial statements because it helps them evaluate a company’s performance and prospects. WorldCom violated the revenue
Premium Generally Accepted Accounting Principles Ethics Auditing
Devon Daniel Verizon Verizon stars with WorldCom in 1983 when Murray Waldron and William Rector came together to sketch out a plan create a long-distance telephone service. Long Distance Discount service‚ became their new company that began operating as a long-distance reseller in 1984. The new company grew quickly in the next fifteen years‚ over time it change to WorldCom. The company became one of the largest telecommunications corporations in the world. They also became the largest bankruptcy
Premium Verizon Communications
Introduction By June 2002‚ it had become evident to the SEC that WorldCom had engaged in a significant corporate accounting fraud scheme which had overstated pretax income by about $7 billion since 1999. At the time‚ this was the largest deliberate misstatement in US corporate history. Although there are many interesting elements and players involved with this incident‚ for the purpose of this case study I will focus on the role played by Betty Vinson‚ the Director of Management Reporting and
Premium Fraud Expense Accounting scandals
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
have more resources to collect all the evidence. If Dawson not support and request Ramos to stop‚ Ramos should consider alternative ways to collect the required data from other sources. This is depicted in the case of Worldcom Saga. The vice president of internal audit – Cynthia Cooper decided to investigate anomalies in the company’s accounting entries. Although‚ the CFO – Scott Sullivan had chided Cynthia for snooping around the accounting treatment‚ but she and her team still working on it behind
Premium Internal audit Auditing Financial audit