Resume Padding
May 13, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
On Monday, May 7, Yahoo apologized to its employees for discrepancies about its CEO, hired in January. Apparently, Scott Thompson, does not have a computer science degree after all, even though that information was included in an SEC filing and in several public bios about him.
Questions:
1. If Thompson allowed false information about his educational background to linger in his bio, should he be treated just like any other employee who did the same? Discuss.
2. Why didn’t this issue come up in a background investigation of the CEO before he was hired? Discuss.
3. What should Thompson have done if it truly was an error? Discuss.
4. Look at the slide show regarding padded resumes (at http://www.washingtonpost.com/business/economy/yahoo-ceo-isnt-the-only-leader-who-has-fudged-resume/2012/05/10/gIQARucmFU_gallery.html?tid=ts_biz#photo=1) What one thing surprised you most in this slide show?
Sources:
McGregor, J. (2012). Yahoo’s CEO Scott Thompson’s Incorrect Resume Raises Questions for Tech Company’s Board. The Washington Post, May 8 (Retrievable at http://www.washingtonpost.com/blogs/post-leadership/post/yahoo-ceo-scott-thompsons-incorrect-resume-raises-questions-for-tech-companys-board/2011/04/01/gIQAXUB5AU_blog.html)
Staff (2012). Yahoo CEO Isn’t the Only Leader Who Has Fudged Resume – Slide Show. The Washington Post, May 10 (Retrievable online at http://www.washingtonpost.com/business/economy/yahoo-ceo-isnt-the-only-leader-who-has-fudged-resume/2012/05/10/gIQARucmFU_gallery.html?tid=ts_biz#photo=1
Bloomberg Video (2012). Will CFO Tim Morse Head Yahoo?, May 9.
Cooking the Books – TSA style?
May 10, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
This week, the House Committee on Oversight and Government Reform released information about the Transportation Security Administration wasting taxpayers’ money; this time they point to a Texas warehouse holding more than 5,000 pieces of security equipment, valued at upwards of $180 million.
Questions:
1. What percentage of equipment has been stored for more than one year?
2. Based on the information in the article and video, what recommendations would you make if you worked for the inspector general’s office?
3. Representative Issa thinks that the TSA has “cooked the books.” Based on your knowledge of accounting and red flags of fraud, do you agree or disagree? Provide your reasoning.
Source:
CNN videos. (2012). TSA Cooked the Books, CNN.com, May 9 (Retrievable online at www.cnn.com/video
Fox, L. (2012). TSA Puts Millions of Dollars of Equipment in Storage, U.S. News, May 9 (Retrievable online at http://www.usnews.com/news/articles/2012/05/09/tsa-puts-millions-of-dollars-of-equipment-in-storage)
Doctorow, C. (2012). TSA Waste and Corruption: The Greatest Hits, BoingBoing, May 9 (Retrievable online at http://boingboing.net/2012/05/09/tsa-waste-and-corruption-the.html)
General Services Administration (GSA) Scandal
April 17, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
A hearing on an extravagant government conference in Las Vegas will enter its second day on Capitol Hill on Tuesday, April 17. During Monday’s session, a House committee heard from officials accused of wasting taxpayer money on fancy meals and over-the-top entertainment. The GSA inspector general, Brian Miller, says he believes the behavior he uncovered could possibly be criminal and he wants the Justice Department to investigate possible bribes and kickbacks.
Questions:
1. According to the video, what were some of the reasons for out-of-control spending?
2. Compare this government scandal to a similar corporate scandal. Discuss any differences or similarities.
3. What types of controls should have been in place to prevent this overspending situation?
4. What issues do identify as criminal offenses? Discuss.
Source:
MSNBC video. (2012). GSA Under Investigation for Frivolous Spending, April 16. (Retrievable online at http://www.msnbc.msn.com/id/31510813/ns/msnbc_tv-the_dylan_ratigan_show/#47066004)
Cordes, N. (2012). Bribes, kickbacks in GSA Scandal? CBS News, April 17 (Retrievable online at http://www.cbsnews.com/8301-505267_162-57415052/bribes-kickbacks-in-gsa-scandal/)
Visit msnbc.com for breaking news, world news, and news about the economy
Big News at Amazon: Fulfillment Robots
March 20, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized
Amazon.com Inc said on Monday it agreed to buy Kiva Systems Inc for $775 million in cash, a deal that will bring more robotic technology to the e-commerce company’s giant network of warehouses.
Questions:
1. What other companies use this kind of robot technology?
2. Discuss the trend of Amazon’s fulfillment costs and what they would mean in terms of net income and taxes.
3. Discuss in general how Amazon would account for the $775 million acquisition and the types of journal entries it would make.
Source: Barr, A. (2012). Amazon’s Kiva Systems Acquisition To Put Robots To Work, Reuters.com, March 19 (Retrievable online at http://www.huffingtonpost.com/2012/03/19/amazoncom-kiva-acquisition_n_1365512.html)
Crime of Grime OR Sign of the Times?
March 16, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
Tide is flying off the shelves, according to the Associated Press. Unfortunately, retailers are not seeing the profits from this familiar laundry soap. Instead, Tide has become a hot commodity among thieves at supermarkets and drugstores in at least some parts of the country. While the maker of Tide, Procter & Gamble, has been baffled about why the brand has gotten so much attention from thieves, law enforcement has discovered direct and indirect links to the exchange of the product for illegal drugs.
Questions:
1. If a retailer uses a perpetual inventory method to account for Tide, what should they also follow up with to determine any shortages in the product?
2. If shortages of Tide are found, how should they be accounted for? Give an example including journal entries.
3. How should the extra expenses of security tagging Tide be accounted for? Give an example including journal entries.
Sources:
Nuckols, B. (2012). Thieves Rolling Tide Detergent Out of Stores, Associated Press, March 15. (Retrievable online at http://abcnews.go.com/US/wireStory/thieves-rolling-tide-detergent-stores-15922603)
Youtube.com (Wane.com). (2012). Retailers speak out against odd Tide thefts, March 14.(Retrievable online at www.youtube.com)
Traveling Electronically Naked
February 16, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
When Kenneth G. Lieberthal travels to China, he leaves his cellphone and laptop at home. As an expert at the Brookings Institute, he instead brings “loaner” devices, which he erases before he leaves the United States and then wipes clean the minute he returns. In China, he disables Bluetooth and Wi-Fi, never lets his phone out of his sight and, in meetings, not only turns off his phone but also removes the battery, for fear his microphone could be turned on remotely. He connects to the Internet only through an encrypted, password-protected channel, and copies and pastes his password from a USB thumb drive. While all of this sounds like a spy thriller, the threat to data security is very real!
Questions:
1. Why does Mr. Lieberthal cut and paste in his passwords from a thumb drive?
2. What was the most interesting point you found in the article that relates to controls for corporations with employees who travel abroad?
3. The article mentions that Federal lawmakers are considering bills aimed at thwarting cybertheft of trade secrets. Discuss whether you think that this legislation could ever deter problems arising from business dealings abroad.
Source:
Perlroth, N. (2012). Traveling Light in a Time of Digital Thievery, Feb. 10 (Retrievable online at http://www.nytimes.com/2012/02/11/technology/electronic-security-a-worry-in-an-age-of-digital-espionage.html?hpw)
YouTube.com (2012). Laptop Anti-Theft: Travel Identity Theft (Retrievable online at http://youtu.be/5d_O-36r9X0)
Audit Irregularities
February 16, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized
According to a report released on Feb. 15 in San Francisco county, about 400 recent foreclosures were determined to involve either legal violations or suspicious documentation. This recent report suggests how pervasive foreclosure irregularities may be across the nation.
Questions:
1. What is the acronym for the mortgage database that was started in 1995 to track information for lenders?
2. What types of legal violations did the report indicate?
3. Where did the greatest number of improprieties occur? What internal controls could have prevented this?
Source:
Morgenson, G. (2012). Audit Uncovers Extensive Flaws in Foreclosures. The New York Times, Feb. 15 (Retrievable online at http://www.nytimes.com/2012/02/16/business/california-audit-finds-broad-irregularities-in-foreclosures.html?_r=2&hp)
Watch that Password!
January 17, 2012 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
Zappos began emailing its 24 million customers Sunday, advising them that its site had been hacked, and some customers’ personal details and account information likely stolen. Despite Zappos’ data breach notification to consumers, the company hasn’t yet answered several key questions, such as detailing when the data breach occurred, the length of time for which attackers may have had access to its systems, or how the breach was finally detected. Zappos also hasn’t indicated whether it will offer identity theft monitoring services to affected customers.
Source:
Hartman, C. (2012). Zappos Hacked, 24 Million Accounts Exposed, 5min LifeVideopedia, January 16 (Retrievable at http://www.5min.com/Video/Zappos-Hacked-24-Million-Accounts-Exposed-517248590)
Schwartz, M. (2012) Zappos Hack Exposes Passwords, InformationWeek, Jan. 17 (Retrievable online at http://www.informationweek.com/news/security/attacks/232400441)
Questions:
1. According to the video, what is Zappos known for?
2. What advice is being given to the compromised account holders? Does it sound like the accounting information system was breached?
3. Who owns Zappos and what industry are they in? What type of contingent liabilities could this breach expose Zappos to?
How do you lose $1.2 Billion?
December 13, 2011 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized, Video Updates
Three of MF Global Holdings Ltd.’s top executives said they didn’t know what happened to as much as $1.2 billion in client funds that went missing in the days before the New York-based brokerage filed for bankruptcy. Jon S. Corzine, former chairman and chief executive officer of the broker testified in Congress that he didn’t intend to misuse as much as $1.2 billion in now-missing customer funds and that other employees of the failed brokerage oversaw the money. According to Corzine, a team of people in the cash finance and cash management divisions of the company had the authority to move customer funds from segregated accounts.
Questions:
1. Where does the bankruptcy of MF Global rank among all other U.S. bankruptcies?
2. What was the amount of the quarterly loss that MF Global reported on Sep. 30?
3. Briefly explain why regulators do not think that the auditors could find the problems in MF Global and what transactions were affected.
4. From what you can find out from research about MF Global, what were the weaknesses with the company that led to this crisis?
Source:
Brush, S. (2011) Top MF Global Execs Say They Don’t Know How Funds Went Missing, Dec. 13 (Retrievable online at http://www.bloomberg.com/news/2011-12-13/top-mf-global-execs-say-they-don-t-know-how-funds-went-missing.html)
CNN VIDEO. (2011). No Christmas for Former MF Global Client, CNN, Dec. 8 (retrievable online at www.cnn.com/videos)
The Volcker Rule
October 17, 2011 by LuAnn Bean
Filed under Accounting Principles, Advanced Accounting, All Articles, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting, Uncategorized
Regulators released a proposal on Oct. 11 known as the Volcker Rule, which is aimed at overhauling how the banking industry carries out its trading activity. The proposal, spanning about 300 pages, includes provisions that scrutinize how banks collect revenue, award compensation and track their compliance with the Volcker Rule.
According to financial industry lawyers and lobbyists these will challenge the very nature of Wall Street.
Questions:
1. What is the Volcker Rule? Specifically, explain the revenue provision focus. Do you think this regulation is needed? Why or why not?
2. The proposal spells out an expansive internal control regime that banks must adopt, creating layers of expensive and time-consuming compliance. Can too much internal control be a bad thing? Discuss in general.
3. Do you agree with Sullivan & Cromwell, who say: “The combined effect of these conditions could have a highly adverse impact not only on foreign banks, but on the position of the United States as a financial center.” Why or why not?
Source:
Protess, B. (2011) With Volcker Rule, Wall Street Braces for Change, The New York Times, Oct. 11(Retrievable online at http://dealbook.nytimes.com/2011/10/11/with-volcker-rule-wall-street-braces-for-change/?ref=business)
