Accounting debacles, such as the case of Enron, brought to light the necessity of accuracy in financial
Question:
Accounting debacles, such as the case of Enron, brought to light the necessity of accuracy in financial reporting and accountability of management.
Pick one of the following companies (Enron, WorldCom, Toshiba, Wells Fargo) to research and report/connect on some of the internal control components and/or principles of internal control activities (SEE CHAPTER 7) that should/could have been implemented to avoid the accounting issues that were brought to the public's attention.
Chapter 7 Internal Control Components
- Control Environment
- Risk Assessment
- Control Activities
- Information and Communication
- Monitoring
Chapter 7 Principles of Internal Control Activities
- Establishment of responsibility
- Segregation of duties
- Documentation procedures
- Physical controls
- Independent internal verification
- Human resource controls
Describe in summary what accounting issue(s) occurred within your chosen company, and then as stated above, note what internal control elements you think should/could have been implemented and why. There is no "one right answer", but you will be graded on how well you link your thoughts on this to what we have learned in chapter 7. Simple, well-organized and justified thoughts will serve you best!
