Walt Pavlo Fraud Case Summary

On the schemes done by Walt Pavlo, many ethical problems were occurred and it will be figured out based on six hyper norms consisting of honesty, fairness, compassion, integrity, predictability, and responsibility and determinants of reputation which are credibility, reliability, trustworthiness, and responsibility.
Because of the lapping, account receivable which involved the fraud did not show as old aging receivable. Generally, it can be easily done by a smaller business which has one employee with all cash handling and recording duties. However, in this case, Walt Pavlo committed this lapping with a few accounting staff systematically. The accounting staff including Walt Pavlo did not have honesty and integrity. Also as accounting staff, they did not have responsibility for disclosing the information and properly recording in compliance with GAAP. …show more content…
In this action, Trustworthiness and credibility could not be seen and as accounting officer in charge of collecting money, he overlooked his responsibility and went to the wrong way.
Regarding Walt Pavlo’s embezzlement, Walt Pavlo and Harold Mann cheated their client with lying and threatening without honesty. Then Walt wrote off huge amount of account and split the money with losing integrity and responsibility.
Restructuring account receivable made the company to lose credibility and integrity and the accounting staff lost honesty. Also if financial reporting manipulated as outstanding accounting balance was disappeared, it is hard to say there are reliability and trustworthiness to the financial report and the company.
Using “cash in transit” was not proper entry and it was just for reduce accounts receivable. To this wrongful statement did not have credibility and reliability and the accounting staff did not performance their responsibility