This website uses cookies to ensure you have the best experience. Learn more

Ethics Assignment: Worldcom Case

682 words - 3 pages

Ethics Assignment: Worldcom case

Introduction: On 21 July 2002, WorldCom, Inc., the then-second largest telecommunications company in the U.S. filed bankruptcy protection. Its failure was due to its executives’ bad business behaviors to manipulate earnings with improper accounting entries. The key persons involved in the fraud were as follows; CEO Bernard Ebbers, CFO Scott Sullivan, the accountants were Bufford Yates (Director of General Accounting), David Meyers (Controller), Troy Norman (Director of Legal Entity Accounting), and Betty Vinson (Director of Management Reporting), pressured by CEO and CFO to prepare improper accounting entries. Those executives and accountants were ...view middle of the document...

Also, her boss assured her that he would take full responsibility of her actions.
Contrast her behavior to that of Cynthia Cooper – what made them behave differently?
Betty Vinson did not have a fully developed her moral compass, which would have prompted her to either refuse to make the fraudulent entries, or leave her job immediately, if the first was not an option. Additional, Vinson had the moral reasoning of her family (husband and children) not follow ethically correct judgment.
On the other hand, Cynthia Cooper, another World Com veteran, headed WorldCom’s internal audit department, had a strong moral compass of what is wrong and what is right. Despite the fact that she was directly warned by the furious CFO to stay away from the suspicious wireless business unit, Cynthia did not end her investigation. Applying what we learned during the session 1, Cynthia Cooper was more duty-based or Deontologicalist, than Betty Vinson, in a way that she was more concerned with what...

Other Papers Like Ethics Assignment: Worldcom Case

Cool Paper

1098 words - 5 pages Case #1 Accounting Fraud at WorldCom 1. The objective of financial reporting is to provide useful information to capital providers, which are also known as the shareholders and investors. At WorldCom, the managers not only failed to provide useful information to the investors, but the fraud they created in their financial statements lead to misjudgment for a lot of the capital providers. The actions of accrual releases that the managers

Ics Worldcom Case Essay

2993 words - 12 pages let them know his displeasure with them personally when they gave advice. A rule or a policy, when implemented, must have a legal and ethical purpose. Implementing an ethical but illegal policy is no longer successful and vice versa. Implementing a code of ethics and having employees read and sign it periodically can reinforce ethical conduct as well emphasize that it is important to the company. In the WorldCom case however, there were no

Should Have Bernard Ebbers Gone To Jail?

1432 words - 6 pages have only benefited the stockholders of the WorldCom. Deontological ethics focuses on the action being right or wrong, as opposed to the consequence being right or wrong for the action. It is also described as duty related ethics. In this case, WorldCom and Ebbers had a duty and the stockholders had a right to have their investment be used wisely and know the true heath of the company. The action to hide unprofitable contracts obviously

Accounting Fraud at Worldcom

3449 words - 14 pages enough and made a pact to cease all fraudulent entries. Although originally brought in as a witness in the case against WorldCom, when prosecution was transferred to Manhattan, it became clear she would be indicted on charges of securities fraud. All in all she served five months in jail and five additional months under house arrest for her involvement. Yet the question remains, was she a victim, following orders from superiors, or a villain

Enron, World Com, & Tyco Scandals

966 words - 4 pages Case Paper 4 Danielle Long Indiana Institute of Technology Enron, World Com, & Tyco Scandals Three of the biggest frauds in American history, were committed by the companies Enron, World Com and Tyco. All three CEO/CFO’ks of these companies’ indulged in malicious intend to create a better financial standing within the company and for themselves. All of them were ethically wrong, regardless of the details. These

Mba 590 Managing Project Risk

4119 words - 17 pages manage project teams, especially when conflict arises. Ethics and effective leadership were also important issues that were similar to the Kerzner case study. Some of the differences were that both Hyundai and Volkswagen were dealing with internal issues due to mergers and becoming effective at mixing different company cultures. The internal issues were the same as in the scenario, but they were on a larger scale for Hyundai and Kia

ETHICS ARTICLE REVIEW

909 words - 4 pages A curious phenomenon happening in the accounting profession is where accountants are now required by law to take classes in ethics on a regular basis. This is seemingly a case of over-reaction with the major scandals of Enron, WorldCom, and Tyco. These high profile cases are out of the ordinary and this appears to be a case of punishing the many for the sins of a few. Ethics can not be taught in a class. A person's character is already so

Is Sales Ethics An Oxymoron?

1698 words - 7 pages . now WorldCom, which emerged from bankruptcy in April 2002, altered the company culture and reputation in part by identifying integrity and ethics as top priorities. The company is also planning continual ethics training for employees, as an essential portion of their new ethics program. Brian R. Levey, Deputy Ethics Officer at WorldCom has said that, "WorldCom is a company committed to doing the right thing. We're emphasizing to all employees

Ethics Reflection Paper

668 words - 3 pages Ethics Reflection Paper STR/581 May 10, 2011 Richard Cronen Ethics Reflection Paper Ethics is very essential in regards to not only how one conducts themselves in their day-to-day lives but also plays a key role in business. When organizations and/or businesses are in the works of creating a strategic plan they must take into consideration the role that ethics will play and the idea of social responsibility affecting the plan in

Addressing the Challenges of Groups and Teams

1082 words - 5 pages even scandal. The worldwide telecommunications company WorldCom first handedly became the biggest corporate bankruptcy case at the time when on June 25, 2002, admitted to inflating earnings by $3.8 billion. The CEO, Bernie Ebbers was sentenced to 25 years in prison for accounting fraud and being the leader of hundreds of employees who hid fraudulent activity from the SEC. Of course, not every employee knew of these dealings, but Ebbers set the

Case Study

1244 words - 5 pages something they do not believe in or feel uncomfortable doing may indicate that the action is not ethical despite it being legal or not. The first step that can be taken by employees in resolving such dilemma is consult with the code of ethics for formal guidance. In the WorldCom case however, there were no written policies for the management practices itself yet the code of ethics. Therefore, the employees in WorldCom had no formal guidance to

Related Essays

Sec Investigation Of Worldcom Essay

2888 words - 12 pages . Rising stock prices gave the company financial leverage and allowed it to purchase more companies. The stocks highest trade was near $65 in 1999. The pressure on WorldCom to keep the stock high and maintain its success was the beginning of its fraudulent accounting practices. The company had over 20 million consumer customers, thousands of corporate clients and 80,000 employees (Sandberg, Blumenstein, & Young, 2002). This was the case until it

Accounting Fraud At Worldcom Essay

1388 words - 6 pages Case Assignment #1 – Accounting Fraud at WorldCom 1. Discuss the fraud at WorldCom in terms of the objective of financial reporting. How was the objective subverted by the actions taken by the managers of WorldCom? A. To begin, the primary objective of financial reporting for most companies is to provide useful information to capital providers. Essentially, the objective is “to assist in the efficient functioning of economies and the

Worldcom Case Essay

468 words - 2 pages Justin Gardner ACCT 4456 Auditing WorldCom Case WorldCom Case Cynthia Cooper was the former Vice President of Internal Audit at WorldCom. Cynthia is widely known as the whistleblower that discovered the fraud that was occurring in 2002. The CFO at the time was having the corporate accounting team capitalize billions of dollars of network leases instead of expensing them as they should have. This let the company report a profit of $2.4

Worldcom Essay

968 words - 4 pages WorldCom WorldCom An internal auditor can be an invaluable asset to any company. They can help uncover anything from small errors in which there were no bad intentions to issues such as fraud that can end up costing the company and those involved in it dearly. In the case of WorldCom, it was the internal audit department that uncovered one of the largest corporate financial scandals in history. On June 25, 2002, WorldCom, a