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WorldCom Notes Essay

Decent Essays
[1] What business was WorldCom in?
WorldCom was in the business of telecommunications.
Where was WorldCom located?
WorldCom was located in Clinton, Mississippi.
Who was the CEO?
The CEO was Bernie Ebbers.
Who was the CFO?
The CFO was Scott Sullivan.
What are the names of the two members of the internal audit staff who worked with Cynthia on their secret investigation? Gene Morse and Glyn Smith
What made the internal auditors think that possibly there was a need to investigate WorldCom’s accounting?
The internal auditors thought that there may be a need to investigate with WorldCom’s accounting stemmed from an unjustified $400M reserve reversal which bumped revenue. When the inquiry was made as to the justification for
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Discuss the key characteristics for the operation of an effective corporate whistleblower hotline. Be sure to highlight potential pitfalls that should be avoided. After online research, key characteristics for the operation of an effective corporate whistleblower hotline identified include:
- Independence: The whistleblower operator should be an independent party from the organization.
- Multiple Access Platforms – There should be multiple ways for individuals to report their claims so that they can easily submit claims.
- Availability – Many hotlines are available 24/7 to allow for users to submit claims when they feel able or become aware. Many employees would likely call outside regular business hours.
- Top-level commitment – Executive management should encourage use of the hotline to provide assurance to employees that it is encouraged to report fraud.
- Reporting and monitoring – Claims submitted should be investigated in a timely fashion
- Anonymity – The hotline should allow for anonymous reporting which encourages individuals to report issues when they know they will not be targeted.

Pitfalls to be avoided include not employing any of the above characteristics. For example, management should avoid scrutinizing the use of the hotline so as to not make employees feel disloyal using it. All reports should be followed up on to the reporter’s satisfaction to ensure that employees feel their
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