Abstract

The caselet looks into the ways in which WorldCom corrupted its account books. The changes in business environment made the company to struggle in the market. The caselet delves into the pressure of the stockholders to continuously generate good returns, without any focus on the long term impact, and how that pressure made the company to get into fraudulent behavior.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• How companies corrupt the account books. How “earnings pressure” affect the performance of a company. The role of top management in perpetuating fraud in a company

Keywords

WorldCom, Overstating Income, Operating Cost, Capital Expenditure, Line Cost Expenses, Understating Expenditure, Improper Accounting, Overstating cash flow and profit