Examining a Business Failure The following paper will examine WorldCom and how the business failed. It will also compare and contrast the contributions of leaderships, management and the organizations structures to how the organization failed the way they did. WorldCom began as a small long distance telecommunication company and progressed into one of the largest telecommunications in the world and the second largest long distance company. It began as a small company in Jackson, MS by Bernie
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REPORT OF INVESTIGATION BY THE SPECIAL INVESTIGATIVE COMMITTEE OF THE BOARD OF DIRECTORS OF WORLDCOM, INC. Dennis R. Beresford Nicholas deB. Katzenbach C.B. Rogers, Jr. Counsel Wilmer, Cutler & Pickering Accounting Advisors PricewaterhouseCoopers LLP March 31, 2003 I. SUMMARY AND CONCLUSIONS ................................................................................. 1 A. The Nature of the Accounting Fraud..................................................................
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the 1990s. The low margins that the industry was accustomed to weren't enough for Bernie Ebbers, CEO of WorldCom. From 1995 until 2000, WorldCom purchased over sixty other telecom firms. In 1997 it bought MCI for $37 billion. WorldCom moved into Internet and data communications, handling 50 percent of all United States Internet traffic and 50 percent of all e-mails worldwide. By 2001, WorldCom owned one-third of all data cables in the United States. In addition, they were the second-largest long
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Analysis of the WorldCom Internal Control Using the COSO Model The control environment 1. Integrity and ethical values Integrity and ethical values are the product of the entity’s ethical and behavioral standards, as well as how they are communicated and reinforced in practice. They include management’s actions to remove or reduce incentives and temptations that might prompt personnel to engage in dishonest, illegal, or unethical acts. They also include the communication of entity values and
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Accounting Fraud @ WorldCom: The Causes, The Characteristics, and The Consequences. Author: Javiriyah Ashraf (2011) Area: The main area of the study was focused on the different offices of WorldCom in United States of America. The core examination areas were Texas, Mississippi, Florida, Georgia, and Washington D.C. to know the causes of the fraud, how the different branches were linked in fraud and what were the main problems faced to the stakeholders after the fraud. Introduction: WorldCom was a provider
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many unethical accounting scandals existed. The WorldCom scandal is one of the most known unethical scandals. WorldCom submitted the largest bankruptcy filing in United States’ history after admitting improperly accounting for more than $3.8 billion dollars in expenses (Moberg, 2012). The company used acquisitions to spurt large growth. Two of WorldCom’s acquisitions included MCI Communications and MFS Communications (UUNet). This caused WorldCom to appear more favorable on Wall Street, and many
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Ryan Streetman July, 26, 2011 WORLDCOM’S FALL AND THE CONTROVERSY OF SARBANES OXLEY WorldCom provided telecommunication services of voice and internet. They began as a long distance reseller in 1984. The company was headed by Bernard Ebbers who became the CEO in 1985. The company didn’t go public until the middle of 1989. Through the years, WorldCom became more than just a telecommunications company. They were also information technology out-breakers. They were able to become an internet powerhouse
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WorldCon: A Case Study of WorldCom ACCT 424B Prof. R. Hayes May 12, 2011 WorldCom is a telecommunications company that was once worth billions but is now merged with Verizon after bankruptcy due to fraudulent activities. The question is what caused one of the largest US corporations began a spiral into financial ruin. WorldCom according to John Sidgmore, a former top executive of WorldCom, stated that WorldCom generated annual revenues of over $30 billion a year, has more than 60,000 employees
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the 1990s, the telecommunication was rapidly growing which led WorldCom to adopt the strategy of purchasing small long distance firms with limited geographic service areas and consolidating carriers with large market shares. This was the company’s main key profit. Indeed, by adopting this strategy, WorldCom grew quickly by expanding internationally in South America, West America, Europe and Latin America. As a result of this, WorldCom became the leader in this industry. - The pressure that Ebbers
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Coulter, 2012, p. 165). In the case of Worldcom, it is clear that the organizational culture was heavily impaired and nearly non-existent. The company did not have a formal statement of values or ethical rules it expected its employees to abide by. This is the underlying issue that eventually led to the demise and bankruptcy of Worldcom. As a leader, you are expected to lead by example and set your organization up for long term success. When CEO of Worldcom, Bernard Ebbers, was told about an internal
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