Phor-Mor Fraud Essay example

632 Words Apr 26th, 2011 3 Pages
Finn’s willingness to go along with the actions of Monus made an already bad situation worse. Finn as the CFO should not have allowed himself to be involved in financial frauds of any sort just to show a profit. Finn should taken control of the situation right then and told Monus what he was doing was wrong and he wouldn’t take part in any of it. Shapir was just as wrong because he was aware of what Monus and Finn were doing and he just ignored it until it the fraud got out of hand. Coopers & Lybrand as the auditors did not exercise due professional care in performing the audit. I don’t feel they obtained sufficient competent evidential matter and they did not use professional judgment when they informed Phar-Mor in advance which stores …show more content…
Then there is Finn the CFO of Phar-Mor who also holds the CMA. Finn, as a member of the IMA should behave ethically and encourage others within his organization to do the same. Finn should have told Monus that he was behaving unethically and if he continued, he would have to be reported. Monus changed the numbers of the financial statements for four months before he turned the task over to Finn, Finn as the CFO and the CMA should have refrained from engaging in any conduct that would prejudice carrying out his duties ethically. Finn was not credible either because he did not carry out his responsibility to disclose information that could potentially influence an intended user’s understanding of the reports, analyses, or recommendations. Finn knew the numbers were false but still allowed the reports to reach the hands of the company’s owners, Finn could have put an end to the fraud instead he chose to engage in behaving unethically.
The ethical message of Phar-Mor is just to do the right thing. If Phar-Mor would have ethically went about recovering from the losses they probably would have still been in business today. Also, know when enough is enough, when to say no, and when to take a stand when n. The company basically had the dominoes effect, one person did wrong encourage the next to do wrong with them, and until eventually everyone is behaving unethically. At the end of dominoes…

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