WorldCom and Satyam: Accounting Scams in the US and India

Case Studies | Case Study in Business, Management, Operations, Strategy, Case Study

ICMR HOME | Case Studies Collection

Case Details:

Case Code : FINC077
Case Length : 24 pages
Period : 2002-2009
Pub. Date : 2012
Teaching Note : Not Available
Organization : WorldCom, Satyam, Teach Mahindra, Mahindra Satyam
Industry : IT, IT Services, Telecommunication
Countries : US,India

To download WorldCom and Satyam: Accounting Scams in the US and India case study (Case Code: FINC077) click on the button below

Pay through PayPal

Amount to be paid:

Prefer to pay in another currency ?
Select Currency for Payment

Exchange Rates: Click Here
Delivery Details: Click Here


For delivery in electronic format: Rs. 300;
For delivery through courier (within India): Rs. 300 + Rs. 25 for Shipping & Handling Charges

Finance Case Studies
Short Case Studies
View Detailed Pricing Info
How To Order This Case
Business Case Studies
Area Specific Case Studies
Industry Wise Case Studies
Company Wise Case Studies

Custom Search

Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Chat with us

Strategic Management Formulation, Implementation, & Control, 12e

Please leave your feedback

Leave Your Feedback

ICMR India ICMR India ICMR India ICMR India RSS Feed

<< Previous


About Worldcom

WorldCom's history dates back to 1983 when Bill Fields started a company in Hattiesburg, Mississippi, under the name "Long Distance Discount Services" (LDDS) to provide long distance telecommunication (telecom) services. In 1985, Bernie Ebbers (Ebbers) was appointed CEO of the company. In 1989, the company went public when it acquired Advantage Companies Inc., a publicly traded long distance telecom services company...

About Satyam

Satyam was incorporated in 1987 as a private limited company providing software development and consultancy services.

Finance | Case Study in Management, Operations, Strategies, Finance, Case Studies

B Ramalinga Raju (Raju) and his brother Rama Raju were the promoters of the company. Before starting Satyam, they were involved in other businesses like construction and textiles. The company started operating from Hyderabad in India with 20 employees...

Corporate Culture

WorldCom's growth through acquisitions led to a mix of people and cultures. WorldCom encouraged a culture where employees were not allowed to question and were simply expected to do what they were asked. It was reported that the employees were unaware of the location of several WorldCom's offices...

Genesis of the Frauds

In the early 1990s, the US economy went through a phase of consolidation, in which many major companies acquired or merged with weaker companies to strengthen their own position in the market. The share prices of companies played a vital role during mergers and acquisitions. Therefore, companies made attempts to maintain the prices of their shares (that is, keep them sufficiently high)...

Accrual Releases

The line costs were estimated monthly at WorldCom. Though the bills for line costs were not paid for several months, the GAAP required WorldCom to estimate these expected payments and match these expenses with revenues in the income statement. Since the cash for this expense was unpaid, the offsetting entry was an accounting accrual to a liability account for the future payment that was owed to the line owner...

Expense Capitalization

By the first quarter of 2001, the accrual release tactic could no longer work toward achieving the targeted E/R ratio since very few accruals were left to release. Sullivan, through Myers and Buford Yates (Yates), director of General Accounting at WorldCom, forced the managers to maintain the 42 percent E/R ratio...

Excerpts Contd... - Next Page>>

Custom Search

Marketing Financial Products
Textbooks Collection

Case Studies in Finance Volume-IV
Work Book - Rs. 750
Workbooks Collection

Case Studies in Finance Vol III

Case Studies in Finance Vol III
e-Book on Case Studies in Finance

Case Study Volumes Collection

Case Studies Links:- Case Studies, Short Case Studies, Simplified Case Studies.

Other Case Studies:- Multimedia Case Studies, Cases in Other Languages.

Business Reports Link:- Business Reports.

Books:- Textbooks, Work Books, Case Study Volumes.