My Personal Feeling in Conclusion of the WorldCom Case Assessment

I had no idea that WorldCom was as large of a scandal as it was.  I was purely blown away at the amount of people directly involved with the orchestration and concealment of such an unethical practice.  The accounting actions of WorldCom are a disgrace to the accounting profession and the external auditing procedures of Arthur Anderson, LLP in this case were nothing less than shameful.  With that being said; with out cases like WorldCom, we may have never seen regulation changes such as the Sarbanes-Oxley Act or the Dodd-Frank Act.  Business should not be with out clear cut rules, regulations, expectations and ethical practices.  Acts such as the two I mentioned should be looked at frequently for updating to prevent further incidents from occurring.  I believe that all of the financial scandals in the early 2000's led our economy to a very weakened state and thus creating the recession we have currently been experiencing.  I would like to leave this on a positive note and with something that anyone in the auditing profession can take away from this case study.  The following is a question from Cynthia Cooper's interview with Dick Carozza at Fraud Magazine along with her response:

"Regardless of new business controls and regulations, fraud examiners and internal auditors will always discover internal fraud - much of the time perpetrated by top executives - and then will be faced with ethical decisions. What kind of encouragement and advice can you give them as they try to honestly and diligently work at their jobs(Carozza, 2008)?"

"Listen to your instinct. If something doesn't feel or seem quite right, it might not be. If people are acting out of character or appear to be working to head you in another direction, step back and ask yourself why. Auditing can often be a plodding process of developing facts, checking and re-checking theories, and connecting the dots. Continue to ask for support and dig until you are satisfied that you've gotten it right. Don't allow yourself to be intimidated by superiors(Carozza, 2008). "

 

 

 

Carozza, D. (2008, March/April). Extraordinary Circumstances: An Interview with Cynthia Cooper. Retrieved from Fraud Magazine: http://www.fraud-magazine.com/article.aspx?id=210