StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Worldcom scandal - Admission/Application Essay Example

Cite this document
Summary
The elements of pressure and rationalization were very apparent in how WorldCom Controller David Myers recounted the events that led to his eventual conviction for Securities Fraud. The pressure that he felt from CFO Scott Sullivan was the ultimate driving force that propelled…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER91.5% of users find it useful
Worldcom scandal
Read Text Preview

Extract of sample "Worldcom scandal"

The elements of pressure and rationalization were very apparent in how WorldCom Controller David Myers recounted the events that led to his eventual conviction for Securities Fraud. The pressure that he felt from CFO Scott Sullivan was the ultimate driving force that propelled him to commit acts which he otherwise thought were questionable. Myers held Sullivan to the highest esteem that when the latter casted doubt on the results of their accounting, he questioned his own capability in what he and his team were able to come up with.

Sullivan declared unilaterally that the margin was wrong and that they had to adjust it according to his personal projections. He was submitted to a lot of pressure from his boss and from the impending time on which he has to smooth things over. Myers described it aptly, “When pressure is applied to a human being, you never know what the outcome is going to be” (Ernst & Young LLP).When looking for an accounting slip-up proved to be futile the second time, he remained repugnant to the call of his moral code that something was wrong.

This continued up to a third time that Myers had already permitted himself to actively take part in the fraud. Rationalization came from Myers’ loyalty to Sullivan. He had his own hesitations but his admiration for Sullivan’s intelligence gave way to actually appreciating things objectively. Myers could have done a number of things before submitting to the wishes of WorldCom’s CFO. The first time was the definitive moment that could have saved him his career and even his freedom. He did not want to disappoint a person he thought too highly of that he forego of his natural instinct that was pointing him to the obvious fact that something was wrong with the company inherently.

The first quarter when he said that he was intimidated into thinking Sullivan was right and that there may have been something wrong, they actually repeated the accounting process and it produced the same results. Myers was indubitably certain that he was right but he feared losing his boss’ good graces. He should have submitted the problem to an auditor or even two, including an independent one. Despite the impending deadline for them to release the financial statements, this should not have been a justification to abstain from what he knew to be the most prudent thing to do.

The findings of an objective third party should have convinced his boss that he was right in the first place and separated his loyalty from actual figures. I do not adhere to the idea that there is a difference between aggressive accounting and outright fraud. This is just a matter of semantics which is perhaps still attributable to Myers’ rationalization process as part of the Fraud Triangle. Myers knew that something was not right from the outset but he never heed the calls of his morals and ethics.

Saying that he did not know he was committing fraud remains wishful thinking. He was aware but he was already in too deep that he had no choice but to believe the web of lies he was led to fabricate. That persistent voice in our head that keeps on nagging us that something is off is the best sign to ascertain that we are crossing unacceptable conduct. There are all too many instances in real life to teach us what is right from what is wrong. When you are moved by something other than what you know to be in tune with your conscience, then you recognize you are crossing a line.

ReferenceErnst & Young LLP, “WorldCom” 2 Apr. 2014. http://www.youtube.com/watch?v=hXSWAK0K5L4 (16 Feb. 2014).

Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Worldcom scandal Admission/Application Essay Example | Topics and Well Written Essays - 500 words”, n.d.)
Retrieved from https://studentshare.org/business/1628949-worldcom-scandal
(Worldcom Scandal Admission/Application Essay Example | Topics and Well Written Essays - 500 Words)
https://studentshare.org/business/1628949-worldcom-scandal.
“Worldcom Scandal Admission/Application Essay Example | Topics and Well Written Essays - 500 Words”, n.d. https://studentshare.org/business/1628949-worldcom-scandal.
  • Cited: 0 times

CHECK THESE SAMPLES OF Worldcom scandal

Corporate governance

Crisis as a pretext of WorldCom corporate governance failure The WorldCom financial scandal came about from the backdrop of several crises that put pressure on the liquidity of the company that may have triggered its shady accounting practice.... When the series of crisis begun in late 1990's which was triggered by a multitude of factors such as bank crisis, dotcom burst and Enron scandal, its stocks depreciated because of industry slowdown that can be attributed to the dire macroeconomic condition during that time and the inappropriateness of juggling its funds by Bernard Ebbers was highlighted and sired many problems in the company....
4 Pages (1000 words) Essay

LEVENDARY CAFE ANALYSIS

1.... Appraise and analyze the management issues that the CEO Mia Foster is facing.... Reference to academic business theory is essential to answering this question.... You should offer examples from the case study where possible.... … 1.... Appraise and analyze the management issues that the CEO Mia Foster is facing....
7 Pages (1750 words) Essay

Corporate Fraud: WorldCom Scandal

Name, Instructor's name, Course, Date Corporate fraud: Worldcom scandal WorldCom Inc.... worldcom was profoundly dependent on acquisitions to stimulate its growth from 1983 all the way through to 1999.... worldcom's plan was to bring in economies of scale that were desperately needed to become successful in the flourishing telecom market at the time (Monks and Nell 577) (Fernando 218).... LDDS then changed its name in May 1995, to worldcom Inc....
5 Pages (1250 words) Essay

AMEX vs NASDAQ - Similarities and Differences

The paper “AMEX vs NASDAQ - Similarities and Differences” is dedicated to specific features of the US stock exchange and the stock market, as well as financial scandals in the stock exchange community due to speculative operations, carried out by worldcom, Qwest during the IPO, and false ratings....
4 Pages (1000 words) Assignment

Case Study on the Elements of Crime

When the dubious account activities and scandal in Enron were revealed it came as a shock to the investors.... When the dubious account activities and scandal in Enron were revealed it came as a shock to the investors.... When Securities and Exchange Commission (SEC) sought an explanation from WorldCom in March 2002, slowly the scandal came to light.... Despite of president's assurances many high profiled companies collapsed. worldcom's main business was electronic commerce and Internet and it was ranked as the second largest telecom company in the whole US....
2 Pages (500 words) Essay

American Stock Exchange

But after the scandal WorldCom was changed.... In September 2002, New York State Attorney General Eliot Spitzer sued five corporate executives (former worldcom chief executive Bernard Ebbers, Qwest chairman Philip Anschutz, former Qwest CEO Joseph P.... Bernard Ebbers was head of worldcom.... worldcom had merged with one of the biggest technological companies MCI in April, 2003.... For a time, worldcom (WCOM) was the United States' second largest long distance phone company....
3 Pages (750 words) Essay

Accounting for Anguish

When Kim Emigh acted as a whistleblower in the Worldcom scandal she revealed to the Security and Exchange Commission and other governmental agencies that WorldCom was attempting to change labor that was supposed to be part of capital projects into an expense in order to misguide the government and lower profits to pay less taxes.... When fraudulent activity and misappropriation occurs in a company such what was occurring at worldcom and an accountant discovers the scheme the only option for the accountant is to become a whistleblower....
1 Pages (250 words) Essay

Managerial Organization Assignment

This research report will be exploring the role that could have been played by the organizational theories for the detection of frauds in the case of worldcom.... The… worldcom operated in the telecommunication service industry and made nearly 65 acquisitions up till 1997, the susses fully growing company turned the eye balls of all The attention of numerous buyers made some hidden truths to depict.... To make the financial statements appear profitable, worldcom increased the value of assets by charging and recording its expenses as assets, this reduced the expenses, and the factual figures became attractive....
4 Pages (1000 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us