The August 5, 2020, issue of the Wall Street Journal includes an article by Tomio Geron entitled
Question:
The August 5, 2020, issue of the Wall Street Journal includes an article by Tomio Geron entitled "Former Trustify CEO's Indictment Highlights Due Diligence Dilemma."
Instructions
Read the article and answer the following questions.
a. What is the crime the chief executive is accused of, and what were some of the fraudulent activities and statements intended to deceive investors?
b. Many early state companies do not have audited financial statement or a chief financial officer. What risks does this present to investors?
c. Despite the apparent lack of audited financial statements or other hard data, approximately 90 investors provided funds to the company. What explanation does the company give to explain why investors might be willing to provide funds despite the lack of hard data?
Step by Step Answer:
Financial Accounting Tools For Business Decision Making
ISBN: 9781119791089
10th Edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Jill E. Mitchell