A Complex Financial Crime Story

Posted by & filed under Accounting Information Systems, 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, Video Updates.

Stephen Flatow, a grieving father, charged that Iran financed the Gaza bus bombing that killed his 20-year-old daughter in 1995. Buried in court filings, the suit alleged that money from a charity “fronted” financial transfers to terrorists from the Iranian government. In fact, the charity, known as the Alavi Foundation, actually operated and owned a… Read more »

The Dirty Little Secret of “Cramming!”

Posted by & filed under Accounting Information Systems, Accounting Principles, Auditing, Cost Accounting, Financial Accounting, Financial Statement Analysis, Fraud Accounting, Intermediate Accounting, International Accounting, Managerial Accounting.

On July 1, 2014, the Federal Trade Commission (FTC) accused wireless carrier T-Mobile of adding bogus charges to customers’ accounts without their consent, in U.S. District Court. Questions: 1. How long did T-Mobile use the practice of “cramming” on customer mobile phone bills and what is the estimated amount of the total fraudulent charges? 2…. Read more »

The worth of an employee?

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CEOs talk about what valuable assets employees are, but these assets do not show up on the company’s balance sheet. Why? Because the company does not and cannot own its employees, even though it may seem so at times. However, employers can put a value on your life through company-owned life insurance (COLI). Questions: 1…. Read more »

Barclay’s Dark Pool

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Fraud Accounting, IFRS, Intermediate Accounting, International Accounting, Managerial Accounting.

Despite Barclay’s private and public assurances to investors in its pool that they were continually shielded from high-speed trading, the bank is being sued for actively attracting high-speed traders to its venue, as well as bolstering high-speed trader strategies with privileged information about the pool. Questions: 1. Summarize why the article essentially called this a… Read more »

The Untouchable Alaska Bypass

Posted by & filed under Accounting Information Systems, Accounting Principles, Advanced Accounting, Auditing, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Intermediate Accounting, Managerial Accounting, Video Updates.

Under a federal program exclusive to Alaska, the Postal Service is responsible for shipping more than 100 million pounds a year of apples, frozen meat, dog food, diapers and countless other consumer items to off-road villages in the sparsely populated outposts known as the bush. Over three decades acting as freight forwarder, the agency has… Read more »

How much do you have to make to get a checking account?

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Zikomo Fields makes more than $100,000 a year in his job as a software engineer in Kansas City. However, he cannot get a bank account because of a little-known database that tracks financial transgressions, known as ChexSystems. Financial institutions who subscribe to this service view it as fraud prevention. However, New York Attorney General Eric… Read more »

Mmmmmmmmm! But watch out for the Mac & Cheese!

Posted by & filed under Accounting Principles, Advanced Accounting, Cost Accounting, Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Intermediate Accounting, Managerial Accounting, Video Updates.

Some are calling this the new “Cheeseapocalypse” as Kraft Foods Group recalls 260 cases of Velveeta sold to Walmart because the batches lack enough preservatives and could “spoil prematurely and/or lead to food borne illness.” Questions: 1. What states are affected by the recall? 2. What ingredient is causing the recall? 3. What types of… Read more »

When is a Raise Too Small?

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Deeb Salem, a former Goldman Sachs trader, says that after making the company in excess of $7 billion in 2010, his $8.25 million raise was not enough compensation. Questions: 1. What percentage drop was Salem’s 2010 raise as compared to his 2009 raise? What percentage drop was Salem’s 2011 raise as compared to his 2010… Read more »

Maybe not such a good business plan.

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In Crumbs Bake Shop’s most recent Form 10-Q filed with the SEC, the company disclosed that its auditors, Rothstein Kass, “expressed substantial doubt about our ability to continue as a going concern.” Questions: 1. Since the IPO of Crumbs, how much has the stock dropped? 2. Explain the statement that Crumbs published in its 10-Q… Read more »

Time to Cash In?

Posted by & filed under Financial Accounting, Financial Reporting and Analysis, Financial Statement Analysis, Intermediate Accounting, International Accounting.

During his eight years as steward of the world’s largest economy, Mr. Bernanke’s salary was about $200,000 a year. Now he makes that in just a few hours speaking to bankers, hedge fund billionaires and leaders of industry. Questions: 1. How much is Mr. Bernanke likely to make this year in speaking fees? 2. What… Read more »