Case Study Of Satyam

These crises along with their claim that their problem with the Enron audit was due to a few “bad partners” was merely the result of an unsound organizational structure along with policies and practices that the firm implemented. The unsound organizational structure of Arthur Andersen changed the motivation of employees within the firm and changes within the firm over the years one of which was the compensation of partners did not allow for integrity when work was being done for these public companies.

Fraudulent financial reporting is one form of corporate corruption and may involve the manipulation of the documents used to record accounting transactions, the misrepresentation of accounting events or transactions, or the intentional misapplication of Generally Accepted Accounting Principles (GAAP) (Crumbley, Heitger, and Smith, 2013). Examples of fraudulent schemes befitting of this category abound and usually involve financial statement items that have been misclassified, omitted, overstated, undervalued, or prematurely recognized. One case involving CEO Bill Smith of Moonstay

In recent year we have seen numerous companies fail as a result of these bad and/or fraudulent practices. In 1998 the publicly traded Waste Management Company falsely reported 1.7 billion in earnings. They got caught when the new CEO and management team went through the books.

Amusingly, Satyam means “truth” in the archaic Indian language “Sanskrit”. Satyam won the ‘Global Peacock Award’ with for global excellence in corporate accountability by the World Council for Corporate Governance on September 2008. Unfortunately, no longer than five months, Satyam became a great accounting fraud after the World Council for Corporate Governance awarded Satyam the Global Peacock Award.

The first section of this essay focuses on the possible causes of corporate failures including dominant CEO, poor strategy decision and the failure of internal control. Secondly, it discusses how the third edition of corporate governance principles and recommendations could be applied to prevent the causes of the failure. The 1st, 2nd, and 7th principles along with specific recommendations will be mentioned in this section. However, the context is concerned solely with the causes stemming from Dick Smith itself.

The breakdown of Dick Smith Electronics has aroused wide concerns in Australia since it brought losses to the related parties at different levels. This essay focuses on analyzing how the company could have possibly avoided the failure if it had applied the third edition of ASX Corporate Governance Principles more effectively.

This case attempts to study and analyze the decisions of the Sunbeam Board of Directors (BOD) during Albert Dunlap’s stint as the Sunbeam’s Chief Executive Officer (CEO). This analysis will comprise the CEO hiring and his shareholder primacy view, first year and second year CEO compensation package review and will conclude the BOD’s decision to fire the CEO. In July, 1996 Sunbeam was a dying brand, which struggled to survive in the increasingly competitive market-place and needed a savior.(case p. 2) Sunbeam’s BOD brought in Al Dunlap to turnaround this ailing firm, based on Dunlap’s proven ‘restructuring and downsizing’ track record. “For much of his career before coming to Sunbeam, Dunlap was known as the poster child of corporate restructuring (case p.1).”

Both of these downfalls suggest that the company’s financial position was steadily decreasing and illustrates the reason for Woolworth’s loosing shareholders during this time. As well as this, 2008 brought an economic downturn, which meant the business would of found it hard to secure any source of finance from banks or potential investors, again contributing towards the businesses financial problems and indicating that it was inevitable that Woolworth’s would fail as a business.

Introduction: A discussion on corporate regulation and governance is of great importance in today’s economic world. A number of high profile collapses such as HIH, One Tel, Harris Scarfe, Ansett, focuses ones attention on governance issues.

All the above issues that led to the bankruptcy of the company were perpetuated by the actions of Lay, Skilling, Fastow and other executives. They all led to the collapse of the company. Lay did not enquire about the decisions that Skilling and Fastow were taking. He just approved to everything that they kept in front of him. Skilling always wanted to keep up to the Wall Street expectations and for this he gave pressure on his executives to find new was to hide the dept. This was the major setback for the company as they didn’t know that in future everything was going to come out and it would have led to bad consequences. Lay did not enquire about all this and approved of all the work Skilling was doing.

Corporate failure is referred to insolvency in Australia, which means the inability to meet the due debt obligations, resulting in business suspension (Michaela, Patricia, Susan, Kimberly, & Matthew, 2012, p. 365). Corporate governance denotes to the system by which corporations are directed and controlled (Michaela et al., 2012, p. 188). Moreover, Hamilton and Micklethwait (2006, p. 1) postulates that the six causes of corporate failure are the most representative with irrespective of sector or geography. Therefore, by applying the six main causes (Hamilton & Micklethwait, 2006, p. 1) and the eight principles (ASX, 2014, p. 4), the scope of the essay is limited to the company prospective without consideration of external issues. Additionally, this essay accesses only the public available information of Vocation.

This also shows the terrible affect it has had on the stock market, the people who are tied with these companies, and how forensic accountants are badly needed to prevent future problems with false financial records. To be informed on the problems and solutions you must first look into the company that started the fraud in the first place.

Accounting is a necessary and vital part of maintaining any business, it is needed to file taxes, know how much one has in assets and liabilities, and indicate to investors whether the company would be a profitable undertaking. However, sometimes the accounting goes horribly wrong when people, even those who seem to be moral and uncorrubtable, fudge the numbers. By inflating books, they can get away with billions of dollars in fraud and make nice bonuses for themselves. However, these acts of greed affect not only the fraudulent person, but their families, coworkers, and other businesses. There are several ways massive accounting fraud has taken place in companies, from increasing depreciation, to not reporting debt, to right-out making up numbers to report. These frauds have been detected in multiple ways as well whistleblowers, internal audits, and even the fraudulent people themselves. The effect of these scandals have taken a heavy toll on businesses financially and on people involved emotionally.

This essay discusses about the corporate collapses in the new millennium. In recent years the Australian corporate sector has witnessed the failure of number of corporations, including HIH Insurance, Harris Scarf, One. Tel, Ansctt Australia. This paper focuses on the financial audit of HIH insurance, which collapsed on 15th March 2001. This was the largest failure in Australian business history. Royal commission was appointed investigate re-issue of HIH Insurance collapsed with debt estimated $5.3 billion Australian dollars (Mirshekary, S, 2005). A brief review of the incidence of corporate failure will be provided prior to an analysis of the collapse of Health International Holding (HIH) and the involvement of its auditor,

When terrorists attacked Mumbai last November, the media called it "India 's 9/11." That tragedy has been succeeded by another that has been dubbed "India 's Enron." In one of the the biggest frauds in India 's corporate history, B. Ramalinga Raju, founder and CEO of Satyam Computers, India 's fourth-largest IT services firm, announced on January 7 that his company had been falsifying its accounts for years, overstating revenues and inflating profits by $1 billion. Ironically, Satyam means "truth" in Sanskrit, but Raju 's admission -- accompanied by his resignation -- shows the company had been feeding investors, shareholders, clients and employees a steady diet of asatyam (or