Fraud And Negligence In Mona's Case

An “audit failure” is a situation in which a professional auditor fails to detect a material error in the financial statements of the company they are auditing. The audit failure in the situation of Rita Crundwell the failure was exacerbated by the fact that the auditors continually signed off on the misstated statements for years. Crundwell is responsible for many of the deficiencies mentioned, such as the missing funds and the incorrect invoices. However, she is not the sole person responsible for this fraud. The lack of internal control is to blame, and this cannot be placed on a single person. The government should have separated duties and used

The appellant, Parkview Queensland Pty Ltd (“Parkview”), is a building contractor who commenced construction of a residential property development under a standard form building contract with Fortia funds Management Ltd (“Fortia”), the developer. Fortia financed the construction under a loan facility with the Bank of Western Australia Ltd (“BankWest”).

2 Managing fraud risk: The audit committee perspective Fraud in a fi nancial statement audit

In this case, Success Assets Pty Ltd (Success) borrowed money from Statewest Credit Society Ltd (Statewest) to purchase land, and the land was mortgaged as security. The plaintiff entered into a guarantee in favour of Statewest which secured the loan and all future loans from Statewest to Success. Success used money borrowed from Home Building Society Ltd (Home) to pay the loan from Statewest. Statewest’s rights under the guarantee (which includes those relating to future loans) and Home’s rights under the were transferred to the defendant, Bank of Queensland (BOQ).

The scenario that present this case is a company faces litigation. I have to surmise how this liability will be reported as well as the resulting effects on the financial statements in the years presented. I will present some facts of this case, and by these facts I will resolve the primary accounting which in my opinion it could accrued the liability, disclose the liability or count it as immaterial.

R/s in January 2014 Taylor was diagnosed with PTSD. R/s Taylor has two sons Joshua (1) and Kane (2-months-old). R/s Taylor is living with some relatives at 612 Hill Street in Conway, SC. R/s Taylor goes to work and leaves the children in Mary Ruth’s care. R/s Mary Ruth’s mind is unstable and she is schizophrenia. R/s there is a possibility that Mary Ruth will leave the children or drop them off to someone else is she gets tired of the children. R/s about two months ago Taylor was sleeping in cars with the small children. R/s the children were malnutrition when they were sleeping in cars. R/s it is alleged that Taylor is bipolar. R/s Taylor has a history of fraud with the food stamps, FADC, and Medicaid.

The Leslie Fay Companies (Leslie Fay) was a designer specializing in women’s stylish dresses. The company was run by Fred Pomerantz and subsequently by his son, John Pomerantz. Both Pomerantz men were known for their lavish lifestyles and overbearing personalities. Fred had hired Paul Polishan right out of college in 1969 to join the accounting staff at Leslie Fay. Polishan would later go on to become the company’s CFO. Polishan, as it seemed, had an even more overbearing personality than either of the Pomerantz men. The personalities and attitudes of these three men would bring about a huge fraud scandal for Leslie Fay, resulting in a Chapter 11 bankruptcy filing in April 1993 (Knapp, 2011).

The accuser had alleged that her supervisor constantly subjected her to sexual harassment both during and after business hours, on and off the employer's premises; she alleged that he forced her to have sexual intercourse with him on numerous occasions, fondled her in front of other employees, followed her into the women's restroom and exposed himself to her, and even raped her on several occasions. She alleged that she submitted for fear of jeopardizing her employment. She testified, however, that this conduct had ceased almost a year before she first complained in any way, by filing a Title VII suit, her EEOC charge was filed later (see infra at n.34). The supervisor and the employer denied all of her allegations and claimed they were fabricated in response to a work dispute.

The following is a case study of a client by the name of Lydia Sanchez. Lydia has been truant 20 times within the past 3 months. Lydia teacher Ms. Ellis sent a referral to the main office because Lydia came in her classroom smelling like alcohol, and marijuana. Ms. Ellis also noted in the referral that Lydia pushed her when she tried to look inside of her backpack. The principal found cigarettes, and a white water bottle filled with alcohol inside Lydia’s backpack. Ms. Ellis noted in the referral that Lydia has not handed in any assignments this year yet. Ms. Ellis told me that Lydia was a straight a student last year, and that she does not know what has gotten into her. Lydia’s mother Stephanie also called into the school stating that her daughter Lydia needs help, and that she has been dating a 21 year old man for the past 6 months. Stephanie does not know what to do with Lydia anymore, and she is worried that she might drop out of high school.

Based on this information, only an immaterial amount of companies actually accrue a liability in their financial statement. Therefore, M Corporation will simply provide disclosure of the contingency and an estimate of the possible loss or range of loss for the future pending litigation in its 2007 financial statement under Note: Contingencies and Commitments. If M Corporation accrued a liability on its 2007 financial statements, then the company becomes too transparent to opposing counsel and it could have serious adverse effects on M’s operations.

1) Anna Thomas committed a fraudulent act by making personal charges and cash withdrawals on Rusher Automotive’s credit card. The accounting profession believes there are three conditions necessary for fraudulent behavior. (See Statement on Auditing Standards No. 99, Consideration of Fraud in a Financial Statement Audit. For additional explanation, you may want to review Buckhoff [2001].)

Fraud is defined as a deliberate misrepresentation that causes a person or business to suffer damages, often in the form of monetary losses through deception or concealment. And Occupational Fraud as defined by the ACFE is the use of one’s occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization’s resources or assets. Traditional fraud triangle theory by Donald Cressey explains that propensity of fraud occurring in an organization lies on three critical elements which are Pressure, Opportunity, and Rationalization.

Deutsche Bank made its entrance into the world in 1870 and it was one of the first banks to adopt universal banking as it promoted and facilitated trade relations between Germany and other overseas markets. Deutsche Bank acquired smaller banks in Germany in order to be the most prominent bank in their home base in addition to having a global reach. Following World War I, inflation took over Germany causing many borrowers to default on their loans forcing the bank to sell most of its assets in order to stay alive (however that diminished their global presence). The bank’s involvement during World War II with the transferring of the Jewish customers holdings to the German Government led to the Allied

Financial statement fraud is any intentional or grossly negligent violation of generally accounting principles (GAAP) that is undisclosed and materially effects any financial statement. Fraud can take many forms, including hiding both bad and god news. Research shows that financial statement fraud us relatively more likely to occur in companies with assets of less than $100 million, with earnings problems, and with loose governance structures (Hopwood, Leiner, & Young, 2011).

If parties enter into a contract that is reflective or derives from a mistake, under common law the contract may be void or voidable. The basis of this decision depends on the type of mistake. Shogun Finance Ltd v Hudson presented a unilateral mistake, in which only one party is mistaken, and in this case, a mistake as to the identity. The difficulty lies when judges must decide whether a contract is void or voidable, which will only protect one of the two arguably innocent parties, the original property owner or the bona fide purchaser. However, the approaches previously taken by the Courts have led to a lack of certainty and coherence in the interests of commercial transactions, and so the Shogun case presented an opportunity for clarification. I am going to raise the argument that the law of mistake is in need of a reform, by following Lord Millett’s proposal to no longer follow the cases Cundy v Lindsay and Ingram v Little. The reasoning within this argument will establish that the cases are inconsistent, lack support for third parties and fail to establish the authority of creditworthiness over identity in commercial contracts. Alternatively, the cases Phillips v Brooks and Lewis v Averay should be used to create a clear established line of case law which can be seen as a fair and practical approach towards mistake and protecting the bona fide purchaser.