about WorldCom. Briefly explain how WorldCom did not honor their statement. WorldCom - "our objective is to be the most profitable ‚ single source provider of communications services to customers around the world. Unstated Mission - Increase shareholder value." WorldCom’s mission statement neatly encapsulated aspirations and strategies to be the leading facilities-based provider of end-to-end Telecommunications and Internet services to business customers globally".(WorldCom.com) WorldCom was the
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WorldCom was born in 1983 with the name LDDS (Long-Distance Discount Service) in Clinton‚ Mississippi. In 1985 Early investor Bernard Ebbers becomes chief executive officers (CEO) of LDDS. The company became public in August 1983 with the acquisition of Advantage Companies Inc. In 1993 LDDS acquired long distance providers Resurgens Communications Group and Metromedia Communications in a three-way stock and cash transaction that created the fourth-largest long distance network in the United States
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WorldCom was the second largest telecommunications corporation in the United States. After thriving in a multi-million dollar business they were forced to close their doors. The reason were practices unethical and fraudulent activities which lead to exposing the business. WorldCom was one of the largest accounting fraud scandals in corporate history. WorldCom had to file for bankruptcy after the organization admitted to accounting fraud. How this came up was a long and drawn out investigation
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distracted from my ability to sympathize with Bernard Ebbers conviction. His defense team argued that the trial judge wrongly instructed the jury that it could convict Mr. Ebbers on the basis that he engaged in “conscious avoidance” of the fraud at WorldCom. It is evident that Ebbers took a blind eye to any consideration to analyze the good stuff from the bad stuff in this situation. He failed to calculate the considerations of utility and as a result he is paying the consequences through a substantial
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AUDIT FAILURE OF WORLDCOM Group 1 Background • WorldCom‚ first named LDDS (Long Distance Discount Services)‚ grew largely by aggressively acquiring other telecommunications companies in 1990s. • For a time‚ it was the United State’s second largest long distance phone company (after AT&T). Background However‚ the year 2002 comes… • In March‚ the SEC began to investigate WorldCom as it reported large profit while AT&T reported loss. • In May‚ Arthur Anderson was replaced by KPMG
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employees. Training can help to educate‚ raise awareness‚ and increase short and long-term company profits. WorldCom was a classic example of failed corporate governance‚ accounting abuses‚ and plain greed that could have been prevented through appropriate management and employee training. This paper will provide an example of a training plan that could have helped prevent the demise of WorldCom. Developing a Training Plan To increase the effectiveness of employees toward the achievement
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WorldCom Critical Thinking Case Study Not only did WorldCom’s organizational culture contributed to the accounting breaches‚ in my opinion it was the catalyst to its ultimate demise in July 2002. Richard Thornburgh stated that “WorldCom could not have failed as a result of the actions of a limited number of individuals. Rather‚ there was a broad breakdown of the system of internal controls‚ corporate governance and individual responsibility‚ all of which worked together to create a culture in
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Running head: CASE ANALYSIS OF THE ACCOUNTING FRAUD AT WORLDCOM Case Analysis of the Accounting Fraud at WorldCom Angela Crossley Troy University October 27‚ 2008 History The origin of WorldCom can be traced back to 1983. The CEO‚ Bernard J. Ebbers‚ of WorldCom had very interesting beginnings. He invested in Long Distance Discount Services (LLDS) with eight other investors‚ and believed that the telecommunications industry was a very good business venture. In the beginning
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would risk arbitragers take in this deal? How would their positions change if the board appears to favour Quest offer? 4. Consider the Worldcom-MCI merger and the Qwest-US West merger. Trying to avoid hindsight bias‚ should the board of MCI and US West have accepted these offers? What is the obligation to shareholders? Was that obligation fulfilled? What about WorldCom and Qwest? Did their shareholders benefit? 5. Which offer should MCI accept? Why? 6. What approach should Verizon take to win takeover
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accounting entries. Assets were inflated‚ sales numbers were inflated and huge debts were omitted from balance sheets. Another company that used accounting to put out fraudulent financial statements was Worldcom. Being the largest accounting scandal in American History at the time of its exposure‚ the Worldcom scandal cost 30‚000 workers their jobs and investors over $180 billion.
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