Worldcom Essay

few effective protections against fraud inundating corporate America. That was supposed to change with the Sarbanes Oxley Act of 2002, which was passed in the aftermath of a couple of high profile accounting scandals with executives from Enron and WorldCom swindling their investors out of millions of dollars. Sarbanes Oxley was sold to the public as a measure that would truly hold corrupt executives accountable, however that message hasn’t made its way to their ivory towers. Let’s put it this…

After the Enron debacle and the WorldCom disaster, Congress decided to enact legislation that would help to protect investors and improve the accuracy of corporate financial statements. The new legislation would be called the Sarbanes-Oxley Act (SOX). This legislation was a major turning point at the time it was passed. This gave investors renewed confidence and made many corporations angry due to the excessive compliance costs. With the new legislation in place many people thought that this…

Despite their differences in purpose and productivity, companies run with a similar basic layout called corporate governance. Even within the company, interest can be categorized into two theories: agency theory and stewardship theory. Agency theory focuses on fixing the misalignment between shareholders and the board of directors in the running of the company. It states that agents will act with a more personalized selfish interest in mind rather than focusing on the interest of the whole,…

rights do not outperform those with weak shareholder rights. In addition, corporate governance has increased in prominence and importance in the business arena in recent years (Rankin, 2006). With the collapse of Xerox, Enron, Tyco International and Worldcom in the US, Parmalat in Italy and other high profile companies including HIH, One.Tel and Harris Scarfe in Australia, there has been a call for improved corporate governance mechanisms (Kiel and Nicholson, 2003; Lavelle, 2002; Thomas, 2002;…

piece of security legislation since formation of the Securities and Exchange Commission in 1934, the landmark Sarbanes-Oxley Act of 2002 was born into a climate still reeling from the burst of the high-tech bubble and fraud scandals at Enron and WorldCom. “ Sarbanes-Oxley Act of 2002 (SOX) is an act passed by U.S. Congress in 2002 to protect investors from the possibility of fraudulent accounting activities by corporations. The SOX Act mandated strict reforms to improve financial disclosures…

MAYBE A BALLER INTRODUCTION HERE IDK CHECK LATER On July 30, 2002, the United States government enacted a law that set expanded or even completely new requirements for all United States public company management, boards and public accounting firms. This was the Sarbanes-Oxley Act, also known as the “Public Company Accounting Reform and Investor Protection Act” in the Senate, and the “Corporate and Auditing Accountability and Responsibility Act” in the House of Representatives. (REFERENCE). In…

numerous cases of corporate scandal have created crisis of confidence in the accountancy profession. Though not every case of corporate scandal and failure can be attributed to auditing failure or auditor’s negligence, some high profile cases as Enron, WorldCom, Parmalat, AIG, Xerox, Adelphia, Lehman Brother etc. were substantially linked to audit failure (Coyle,…

Before a consumer purchases a product, that product or service has been marketed in so form. It may have been through word of mouth, social media, business to business, print media or one of many other forms of advertising. Businesses use these tools in order to market and sell products and services to consumers. While advertising is necessary and a huge part of society, many seem to fall and get trapped into false promises and bad advertising practices. Businesses in the used car industry, diet…

outlined by the SEC, but these held maximum penalties of $1 million in fines and up to 10 years in prison (Chang, Choy, & Wan, 2002, p. 180). The Sarbanes-Oxley Act (SOX) was enacted in 2002 after a slue of financial fraud cases, such as Enron and WorldCom, emerged. Under SOX, penalties for misstatement of information is serious than prior acts with maximum fines of $5 million and 20 years imprisonment for those employees who are charged with misleading or hiding evidence (Gleason, Madura, &…

As seen in the WorldCom case, Vinson’s silence about unethical accounting played a major role in the organization’s downfall. For me, standing up for what I believe is ethically justified is more important than financial success. Just because the decision maker has more…