Worldcom

Accounting Fraud at WorldCom WorldCom Group, a telecommunications comp some(prenominal), caused one of the largest lead on and bankruptcy scandals in American and global corporate history. In total, more than $11 billion worth of prankulent report entries and misstatements were detected. On July 21, 2002, the federation filed for bankruptcy protection under Chapter 11 of the U.S. unsuccessful person Code. Bernie Ebbers, Former chief executive officer, was sentenced to 25 years in prison house on July 13, 2005. Major Factors Contri entirelyed to Fraud The quest were several major factors that contributed to the fraud at WorldCom: Company socialization According to the facts given in the case, Bernard Ebbers and Scott Sullivan, the CEO and CFO of the smart set at that clock, had created a company burnish, in which leaders and managers were non to be questioned. The employees simply just did what they were told. This culture discouraged differ opinion and ensured fo llowers would conform. Moreover, an employee could be discount from a transaction if he or she attempted to argufy senior managers. Hence, close employees felt too insecure to drive forward leery or fraudulent practices. In addition, the charge of the company did non even put forth any effort to effect a corporate computer code of demand.

As tell in the case, Ebbers reportedly described creating a code of yield as a colossal waste of time. Without a corporate code of conduct, management appeared to be insouciant with ethics and focused solely on the companys goal, which was to be the number one stock on circumvent road; therefore, employees tended to commit fraud because t hey felt that ethical conduct was not a focu! s or priority at heart the company. Company Structure WorldComs company structure importantly contributed to its failure. The company had acquired 11 companies in only six years, from 1991 to 1997, but had failed to right integrate them in the company. According to the facts given in the case, for each one department had its own rules...If you want to stir a plenteous essay, order it on our website: OrderEssay.net

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