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Working in assigned teams, students will prepare several pieces of written business communication and present to the class a summary of their topic, complete with powerpoint presentation. The purpose of this assignment is twofold: for students to learn about an historical accounting controversy, and for students to practice effective business communication in the forms of e-mail, memo, business letter, business report and verbal presentation.
Situation: Students are to pretend they are working for an accounting/consulting firm. At a networking event, they meet Fred Jones, Chief Financial Officer of Varied Brands, Inc. a large, potential client. He asks about one of the accounting frauds listed below – he’s heard the name but is only partly familiar with what happened. The assignment is to write a report which will explain the fraud in detail (i.e. what they did, why they did it, how they got away with it, when they were caught, consequences to the company, consequences to individuals, etc.).
A cover letter and the full report will be written to impress this potential client. Each group must prepare the following.
1. E-mailto Instructor with an attached one-page memo outlining the format of the report and the duties assigned to each team member DUE FRIDAY, FEBRUARY 16th, 2024 by 5:00PM.
2. Letter to CFO with the business report attached DUE WEDNESDAY, APRIL 3rd, 2024 by 5:00PM (an electronic copy submitted via a Learn dropbox.
3. Powerpoint presentation summarizing their report - a hard copy OR electronic copy must be submitted to the instructor PRIOR to the date of their presentation, [email protected]. In-class presentations will occur between MONDAY April 1st and WEDNESDAY, APRIL 3rd in a predetermined random order.
In addition, each group member may submit a peer review for all other members of the group, in the format
below. If any group member does not submit a peer review it will be assumed that the peer reviews submitted by all other group members are accurate. Peer reviews must be submitted via a Learn dropbox by no later than 5:00pm on WEDNESDAY, APRIL 3rd, 2024.
Topic Areas:
1. Worldcom – large telecommunications company that falsified F/S and went bankrupt
2. Computer Associates – kept books open after quarter end to boost sales
3. Waste Management Inc. – waste company that falsified F/S
4. Tyco – conglomerate that falsified F/S
5. Dynegy – used a complex financing structure that made it appear cash flow had increased
6. Nortel Networks – huge Canadian telecommunications company that went bankrupt
7. Adelphia Communications – family run cable company that went public and falsified F/S
8. Bernard Madoff Investment Securities – famous Ponzi scheme
9. Satyam Computer Services – Indian company that falsified F/S
10. Sino-Forest Corporation – Chinese forestry company listed on TSE misstated assets
11. Global Crossing – used complex derivatives to manipulate earnings
12. HealthSouth – US healthcare company that hid financial problems
13. AIG (Gen Re) – large American insurance company that used complex reinsurance transaction to respond to analyst criticisms
14. ZZZZ Best – teenager who fooled financial community with a fake company
15. Bre-X Minerals – large Canadian gold miner who faked gold findings
16. Penn West – Canadian oil and gas company manipulated income using reserves (2017)
17. Rite Aid Corp. – limitations of auditors when collusion exists
18. Livent Inc. – Canadian theatre company that falsified F/S
19. Orange County investment losses – government that went bankrupt owing to questionable investments
20. Barings trading losses – rogue trader brings down large British bank
21. National Australia Bank FX Options – 4 traders cause $360 million loss (2004)