WorldCom history The history of WorldCom Company dates back in 1983 which started as a partnership between a former basketball coach Bernard Ebbers. This company was established at Mississippi as a coffee shop, which later developed to long distance Telephone Company. The company’s name initially was Long Distance Discount Service whose operations began on 1984. After several years in operation, the company became public in August 1989 with Bernard Ebbers as the company’s CEO (Moberg 4). Over the
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WorldCom – A Business Failure Austin W. Anderson Organizational Leadership, LDR/531 12 May 2012 Alan Klingsieck WorldCom WorldCom was founded as the Long Distance Discount Services, LTD (LDDS) in 1983, and was based in Hattiesburg, Mississippi. In 1985, Bernard Ebbers was selected as its chief executive. The company went public in 1989 and merged with Advantage Companies, Inc. In 1985, the company’s name was changed to
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WORLDCOM CASE ANALYSIS The WorldCom case is another example of large corporation failures where individuals in the firm failed to act in a morally correct way. Bernard Ebbers, the CEO and Scott Sullivan, the CFO, of the corporation should have been aware of the accounting processes being used in his firm (and undoubtedly he was aware) and should have taken steps to prevent others test for ethics. Authur Anderson also missed opportunities where he could have disclosed the fraud. Cynthia Cooper and
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WorldCom, a Hattiesburg, Mississippi based company began as Long Distance Discount Service Inc. (LDDS). In 1989 through a merger with Advantage Companies Inc., went public. Becoming LDDS WorldCom in 1995 then changed to WorldCom. In 2000, the company suffered serious setback, the industry downturned forcing abandonment of its proposed merger with Sprint. WorldCom’s stock prices declined, the CEO was pressured to cover margin calls from the banks on WorldCom stock that was used to finance other
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WorldCom Case Study Update 20061 by Edward J. Romar, University of Massachusetts-Boston, and Martin Calkins, University of Massachusetts-Boston In December 2005, two years after this case was written, the telecommunications industry consolidated further. Verizon Communications acquired MCI/WorldCom and SBC Communications acquired AT&T Corporation, which had been in business since the 19th Century. The acquisition of MCI/WorldCom was the direct result of the behavior of WorldCom's senior managers
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WorldCom WorldCom was a telecommunications giant that failed and was forced into bankruptcy. WorldCom was America’s second-largest long-distance telephone company and was the largest mover of internet traffic. The company started as a small-town Mississippi company that behemoth more than sixty acquisitions in the span of fifteen years (Trans). WorldCom managed to commit the largest accounting FRAUD in history. Bernard Ebbers, WorldCom’s CEO, 63 years old, was convicted of orchestrating this 11
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2: “WorldCom, Inc.: Corporate Bond Issuance” Case Highlights This case is about the $37-billion bid for MCI Corp., by WorldCom – the United States’ second largest long distance phone company (after AT&T at the time). The purchase should come through by using its own stock to buy the public shares of MCI that did not belong to British Telecommunications (BT), and paying with cash the 20% stake BT held in MCI. In order to finance BT’s stake, WorldCom planned
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Accounting Fraud at WolrdCom Introduction WorldCom, US second largest telecommunication company shocked the world by filing bankruptcy at 21 July 2002. The WorldCom filing surpassed Enron and became the largest bankruptcy filing in United States history. Due to its rapid growth, WorldCom is also heavily in debt as they finance the company growth with debt. The collapse of WorldCom did not just affect their employees, retailers, the government but also bankers. WorldCom was a multi-billion dollar telecommunications
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The fraud committed at WorldCom is an enigma in itself; internal auditors had a great deal of struggles to overcome. The company was bogged down by inefficiencies, with subsidiaries all over the country and little cohesion. WorldCom was governed by a tyrant whose goal was growth that could not be maintained except through constant acquisitions, which were put to a stop to protect markets. The company had no written policies or corporate code of conduct, with different divisions following different
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Restoring Trust in WorldCom 1. What are the three or four central objectives that Breeden hopes to achieve with the proposals in “Restoring Trust”? Why is reform needed? What are the benefits? What are your concerns regarding the reform? The WorldCom Corporate Monitor, Richard Breeden, believed that in order to correct the ills that faced the company, WorldCom needed to adopt a strong Corporate Governance structure. The central objectives of his proposal “Restoring Trust” included improving
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