Ethics in Accounting and the Fall of WorldCom Alison Painter Breeden Juanita S. Edwards, CPA ACC 557: Financial Accounting 23 January 2013 Ethics in Accounting and the Fall of WorldCom In 2002, WorldCom was the second largest telecommunications company in the United States, but because of management failures and an unethical accounting culture it went bankrupt. This paper contains a discussion describing corporate ethics currently used in business; WorldCom's background, and the ethical
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business will then beginning to have problems. Once a business begins a downward spiral it is very hard to break free from it. WorldCom Inc. was one of those companies in which rose to fortune and fame but came crashing down once these elements were blurred or forgotten. Although the company did try to stay afloat, it was too late to reverse the damage. History WorldCom Inc. was developed by Murray Waldron and William Rector in 1983 by planning to create a discount long-distance provider named
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Review of Accounting Ethics ACC557 Financial Accounting Ethics in Accounting and the Fall of WorldCom In 2002, WorldCom was the second largest telecommunications company in the United States, but because of management failures and an unethical accounting culture it went bankrupt. This paper contains a discussion describing corporate ethics currently used in business; WorldCom's background, and the ethical breach; how WorldCom's ethical issue was discovered, describing how management failed
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| Bernie Ebbers - WorldCom | Ethical Profile | Khristin B. Vargas | uNIVERSITY OF lA vERNE 1/22/2015 | | | Table of Contents Introduction 3 Timeline leading to Ebbers conviction: 3 Current Events 4 Perceived Motivations 5 Impacts 6 Conclusion 6 Bibliography 7 Introduction “The recent corporate accounting scandals at Enron, WorldCom, and other corporations have helped to fuel a massive loss of confidence in the integrity of American business, Bernie Ebbers
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Enron, WorldCom, Tyco Enron, 2001 Enron, a Houston-based energy trading company, was the seventh largest company in the U.S before it filed for bankruptcy in 2001. It employed over 25,000 people, and paid its tops executives a sum of $1.4 billion in 2000. According to Fortune magazine, it was one of the “most admired companies” in the U.S. at the time. The reason Enron was so successful was that it kept hundreds of millions worth of debt off its books through the use of some unethical accounting
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never arrived, and countless other unethical practices. Top executives at WorldCom were convicted for the corruption that finally bought the telecommunications company down. However, the exposure of WorldCom revealed weak internal controls and a lack of effective organ- izational structure and civility that seem to be present in other top companies. WorldCom organizational behavior theories could have predicted or even explain the failure of WorldCom . Additionally, I will offer perspectives
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Provide two (2) examples of companies that have been guilty of ethics-based malfeasance related to financial management and determine why their comeuppance was deserved. The two companies that I focus on in this section are Goldman Sachs company and WorldCom in the telecom world. Goldman Sachs was charged by the securities exchange commission, with fraud because the company developed and marketed an artificial collateralized debt system. Paulson & Co had the same invested and at stake with in the
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the work. The steady parade of top executives confessing to engage in price gouging, tax dodges, accounting shams, employee rip-offs, and other shady unacceptable acts are coming to light daily. Unethical and illegal practices are documented from the RJR Nabisco scandals in 1988 to today’s Enron, WorldCom, Merrill Lynch, Arthur Anderson, Xerox, and endless other corporations. The world realizes now that corporate greed is not about one-bad company, but large companies in general that have adopted
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Worldcom was founded as a long distance provider in Mississippi region. Later on, the company started acquiring small telecommunications firms what caused a robust increase leading to over thirty seven billion revenues. The year 1999 was marked by a huge slowdown in the internet and telecommunications industries. Wall Street market reacted to this unusual decrease immediately, so the stock prices began to fall. In order to keep the investments and prevent the fall of earnings, Worldcom began
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Unethical behaviors in the accounting field is extremely important to investors and stock holders. This is critical information will help determine their investment in the company and the amount of stock that they are going to purchase. Misleading financial funds in order to gain personal leverage, misuse of analysis, exaggerating revenue of assets, bribery and security fraud are just a few problems of unethical behavior. In 2002, Enron/Andersen and the Worldcom scandal were two companies that
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