What were the consequences to Cynthia Cooper and Betty Vinson both personally and professionally? Consider what happened to them during the time of the articles as well as doing research on what has happened to them since.

World Com Case Study

Cynthia Cooper CLINTON, Miss.

–Sitting in his cubicle at WorldCom Inc. headquarters one afternoon in May, Gene Morse stared at an accounting entry for $500 million in computer expenses. He couldn’t find any invoices or documentation to back up the stunning number.”Oh my gosh,” he muttered to himself. The auditor immediately took his discovery to his boss, Cynthia Cooper, the company’s vice presidentof internal audit. “Keep going,” Mr. Morse says she told him.A series of obscure tips last spring had led Ms. Cooper and Mr. Morse to suspect that their employer was cooking its books. Armed with accounting skills and determination, Ms. Cooper and her team set off on their own to figure out whether their hunch was correct. Often working late at night to avoid detection by their bosses, they combed through hundreds of thousands of accounting entries, crashing the company’s computers in the process.By June23, they had unearthed $3.8 billion in misallocated expenses and phony accounting entries. It all added up to an accounting fraud, acknowledged by the company, that turned out to be the largest in corporate history.

Their discoveries sent WorldCom into bankruptcy, left thousands of their colleagues without jobs and roiled the stock market.At a time when dishonesty at the top of U.S. companies is dominating public attention, Ms. Cooper and her team are a case of middle managers who took their commitment tofinancial reporting to extraordinary lengths. As she pursued the trail of fraud, Ms. Cooper time and again was obstructed by fellow employees, some of whom disapproved of WorldCom’s accounting methods but were unwilling to contradict their bosses or thwart the company’s goals.WorldCom is under investigation by the Justice Department and the Securities and Exchange Commission. Scott Sullivan, WorldCom’s former chief financial officer and Ms. Cooper’s boss, has been indicted. He has denied any wrongdoing. Four other officers have pleaded guilty and are cooperating with prosecutors. Federal investigators are still probing whether Bernard J. Ebbers, the company’s former chief executive, knew about the accounting improprieties. Since the initial discoveries, WorldCom’s accounting misdeeds have grown to $7 billion.Behind the tale of accounting chicanery lies the untold detective story of three young internal auditors, who temperamentally didn’t fit into WorldCom’s well-known cowboy culture. Ms. Cooper, 38 years old, headed a department of 24 auditors and support staffers, many of whom viewed her as quiet but strongwilled. She grew up in a modest neighborhood near WorldCom’s headquarters and had spent nearly a decade working at the company, rising through its ranks. She declined to be interviewed for this story. Mr. Morse, 41, was known for his ability to use technology to ferret out information.

The third member of the team was Glyn Smith, 34, a senior manager under Ms. Cooper. In his spare time he taught Sunday school, took photographs and bicycled. His mom had taught him and Ms. Cooper accounting at Clinton High School.Frightened that they would be fired if their superiors found out what they were up to, the gumshoes worked in secret. Even so, their initial discrete inquiries were stonewalled. Arthur Andersen, WorldCom’s outside auditor, refused to respond to some of Ms. Cooper’s questions and told her that the firm had approved some of the accounting methods she questioned. At another critical juncture in the trio’s investigation, Mr. Sullivan, then the company’s CFO, asked Ms. Cooper to delay her investigation until the following quarter. She refused.Ms. Cooper’s first inkling that something big was amiss at WorldCom came in March 2002. John Stupka, the head ofWorldCom’s wireless business, paid her a visit. He was angry because he was about to lose $400 million he had specifically set aside in the third quarter of 2001, according to two people familiar with the meeting. His plan had been to use the money to make up for shortfalls if customers didn’t pay their bills, a common occurrence in the wireless business. It was a well-accepted accounting device.But Mr. Sullivan decided instead to take the $400 million away from Mr. Stupka’s division and use it to boost WorldCom’s income.

Mr. Stupka was unhappy because without the money, his unit would likely have to report a large loss in the next quarter.Mr. Stupka’s group already had complained to two Arthur Andersen auditors, Melvin Dick and Kenny Avery. They had sided with Mr. Sullivan, according to federal investigators.But Mr. Stupka and Ms. Cooper thought the decision smelled funny, although not obviously improper. Under accounting rules, if a company knows it is not going to collect on a debt, it has to set up a reserve to cover it in order to avoid reflecting on its books too high a value for that business. That was exactly what Mr. Stupka had done. Mr. Stupka declined to comment.Ms. Cooper decided to raise the issue again with Andersen. But when she called the firm, Mr. Avery brushed her off and made it clear that he took orders only from Mr. Sullivan, according to the investigators.

Mr. Avery and Mr. Dick declined to comment. Patrick Dorton, a spokesman for Andersen, said his firm thought that the $400 million wireless reserve was not necessary.”That was like putting a red flag in front of a bull,” says Mr. Morse. “She came back to me and said, `Go dig.’ “Some internal auditors would have left it at that and moved on. After all, both the company’s chief financial officer and its outside accountants had signed off on the decision. But that was not Ms. Cooper’s style. One favorite pastime among the auditors who reported to her was applying the labels of the Myers-Briggs & Keirsey personality test to their fellow staffers. Ms. Cooper was categorized as an INTJ –introspective, intuitive, a thinker and judgmental. “INTJs,” according to the test criteria, are “natural leaders” and “strong-willed,” representing less than 1% of the population.And so Ms. Cooper decided to appeal the decision. As head of auditing, it was her responsibility to bring sensitive issues to the audit committee of WorldCom’s board. She brought the reserves question to the attention of the committee’s head, Max Bobbitt. At a committee meeting at the company’s Washington offices on March 6, she and Mr. Sullivan presented their cases, according to minutes from the meeting. Mr. Sullivan backed down, according to people familiar with his decision.

The next day he tracked down Ms. Cooper. Unable to reach her immediately, Mr. Sullivan called her husband, a stay-at-home dad to their two daughters, to get her cellphone number. He finally caught up with her at the hair salon. In the future, she was not to interfere in Mr. Stupka’s business, Mr.Sullivan warned, according to people familiar with the reserves question.The confrontations put Ms. Cooper in a sticky position. Mr. Sullivan was her immediate supervisor. Plus, her vague discomfort with the way WorldCom was handling its accounting led her into areas that were not normally her bailiwick. Although her department did a small amount of financial auditing, it primarily performed operational audits, consisting of measuring the performance of WorldCom’s units and making sure the proper spendingcontrols were in place. The bulk of the company’s financial auditing was left to Arthur Andersen.

But neither of those things dissuaded Ms. Cooper from following her nose to the root of the ill-defined problem.On March 7, a day after Ms. Cooper had visited with the audit committee, the SEC surprised the company with a “Request for Information.” While WorldCom’s closest competitors, including AT&T Corp., were suffering from a telecom rout and losing money throughout 2001, WorldCom continued to report a profit. That had attracted the attention of regulators at the SEC, who thought WorldCom’s numbers looked suspicious.But investigators had grown frustrated as they combed through public filings looking for evidence of wrongdoing, according to people familiar with the inquiry. So they asked to see data on everything from sales commissions to communications with analysts.Concerned about why the SEC was sniffing around, Ms. Cooper directed her group to start collecting information in order to comply with the request.She also was growing concerned about another looming problem. Andersen was under fire for its role in the Enron case, which soon would lead to the accounting firm’s indictment. It was clear that WorldCom would have to retain new outside auditors.Ms.Cooper set off on an unusual course. Her own department would simply take on a role that no one at Worldcom had assigned it.

The troubles at Enron and Andersen were enough to warrant a second look at the company’s financials, she explained to Mr. Morse one evening as they walked out to WorldCom’s parking lot. Her plan: her department would start doing financial audits, looking at the reliability and integrity of the financial information the company was reporting publicly.It was a major decision, which would necessitate a lot more work for Ms. Cooper and her staffers. Still, Ms. Cooper took on financial auditing without asking permission from Mr. Sullivan, her boss, according to investigators and a person familiar with Ms. Cooper’s decision.”We could see a strain in her face,” recalls her mother, Patsy Ferrell, about that time period. “She didn’t look happy. We knew she was working late and some of the other people were working late. We would call and say, `Can we bring some sandwiches?’ and her father would bring them sandwiches.”
Several weeks later, Mr. Smith, a manager under Ms. Cooper, received a curious e-mail from Mark Abide, based in Richardson, Texas, who was in charge of keeping the books for the company’s property, plants and equipment.Mr. Abidehad attached to his May 21 e-mail a local newspaper article about a former employee in WorldCom’s Texas office who had been fired after he raised questions about a minor accounting matter involving capital expenditures. “This is worth looking into from anaudit perspective,” Mr. Abide wrote. Mr. Smith, who declined to be interviewed, forwarded the e-mail to Ms. Cooper, according to investigators and a lawyer involved in the case.The e-mail piqued Ms. Cooper’s interest. As part of their initial foray into financial auditing, Ms. Cooper and her team had already stumbled on to the issue of capital expenditures, a subject that would prove to be crucial to their quest.The team had run into an inexplicable $2 billion that the company said in public disclosures had been spent on capital expenditures during the first three quarters of 2001. But they found that the money had never been authorized for capital spending.Capital costs, such as equipment, property and other major purchases, can be depreciated over longperiods of time. In many cases, companies spread those costs over years. Operating costs such as salaries, benefits and rent are subtracted from income on a quarterly basis, and so they have an immediate impact on profits.

Ms. Cooper and her team were beginning to suspect what was up with the mysterious $2 billion entry: It might actually represent operating costs shifted to capital expenditure accounts –a stealthy maneuver that would make the company look vastly more profitable.When Ms. Cooper and Mr. Smith asked Sanjeev Sethi, a director of financial planning, about the curious adjustment, he told them it was “prepaid capacity,” a term they had never heard before. Further inquires led them to understand that prepaid capacity was a capital expenditure. But when they asked what it meant, Mr. Sethi told them to ask David Myers, the company’s controller, according to Mr. Morse and a person familiar with Ms. Cooper’s situation. Mr. Sethi did not return phone calls.Ms. Cooper and Mr. Smith opted instead to call Mr. Abide, who had pointed out a capital expenditures problem in his e-mail. When they asked him about “prepaid capacity,” he too answered very cryptically, explaining that those entries had come from Buford Yates, WorldCom’s director of general accounting.While perusing records looking for accounting irregularities later that same day, May 28, Mr. Morse made the big discovery of the $500 million in undocumented computer expenses. They also were logged as a capital expenditure. “This stinks,” Mr. Morserecalls thinking to himself. He immediately went to Ms. Cooper to tell her what he’d found. She called a meeting of her department. “I knew it was a horrific thing and she did too, right off the bat,” says Mr. Morse.Several days later, Ms. Cooper and Mr.Smith met to try to make sense of their growing list of clues. Particularly puzzling were the cryptic comments made by Mr. Sethi and Mr. Abide. Finally the two auditors came up with a plan of action to test their sense that when it came to the booking of capital expenditures, something was very wrong at WorldCom.

Ms. Cooper would send Mr. Smith an e-mail saying she wanted to know more about prepaid capacity as soon as possible, and asking how much harder they should press Mr. Sethi. They would copy Mr. Myers on the e-mail.Mr. Myers shot back an e-mail. Mr. Sethi should be working for him and did not have time to devote to Ms. Cooper’s inquiries, he wrote. Ms. Cooper had been stonewalled yet again.Ms. Cooper and Mr. Smith didn’t know it, but they had stumbled onto evidence that some executives were keeping two sets of numbers for the then-$36 billion company, one of them fraudulent.By 2000, WorldCom had started to rely on aggressive accounting to blur the true picture of its badly sagging business. A vicious price war in the long-distance market had ravaged profit margins in the consumer and business divisions. Mr. Sullivan had tried to respond by moving around reserves, according to his indictment. But by 2001 it wasn’t enough to keep the company afloat.And so Mr. Sullivan began instructing Mr. Myers to take line costs, fees paid to lease portions of other companies’ telephone networks, out of operating-expense accounts where they belonged and tuck them into capital accounts, according to Mr. Sullivan’s indictment.

It was a definite accounting no-no, but it meant that the costs did not hit the company’s bottom line –at least in the version of the books that were publicly scrutinized. Although some staffers objected, the scheme progressed for the next fivequarters.Ms. Cooper, Mr. Smith and Mr. Morse didn’t know this. They only knew that accounting entries had been hopscotching inexplicably around WorldCom’s balance sheets and that nobody wanted to talk about it. To put all the pieces together, they would need to plumb the depths of WorldCom’s computerized accounting systems.Full access to the computer system was a privilege that normally had to be granted by Mr. Sullivan.

But Mr. Morse, a bit of a techie, had recently figured out a way around that problem.Without explaining what he was up to, Mr. Morse had asked Jerry Lilly, a senior manager in WorldCom’s information technology department, for better access to the company’s accounting journal entries. Mr. Lilly was testing a new software program and gave Mr. Morse permission to road test the system, too.The beauty of the new system, from Mr. Morse’s perspective, was that it enabled him to scrutinize the debit and credit sides of transactions. By clicking on a number for an expense on a spreadsheet, he could follow it back to the original journal entry –such as an invoice for a purchase or expense report submitted by an employee, to see how it had been justified.Sifting through the data for answers to still-vague questions about capital expenditures amounted to a frustrating task, Mr. Morse says.

He combed through an account labeled “intercompany accounts receivables,” which contained 350,000 transactions per month. But when he downloaded the giant set of data, he slowed down the servers that held the company’s accounting data. That prompted the IT staff to begin deleting his requests because they were clogging and crashing the system.Mr. Morse began working at night, when there was less demand on the servers, to avoid having his work shut down by the IT department. During the day, he retreated to the audit library –a windowless, 12-by-12 room piled with files from previous projects and tucked away in the audit department –to avoid arousing suspicion.By the first week of June, Mr. Morse had turned up a total of $2 billion in questionable accounting entries, he says.Having found the evidence they were looking for, the sleuths were suddenly faced with how serious the implications of their endeavor really were.Mr. Morse grew increasingly concerned that others in the company would discover what he had learned and try to destroy the evidence, he says.

With his own money, he went out and bought a CD burner and copied all the incriminating data onto a CD-Rom. He told no one outside of internal audit what he had found.Mr. Morse even kept his wife, Lynda, in the dark. Each night, he’d bring home documents he was studying. He instructed his wife not to touch his briefcase. His wife thought the usually gregarious father of three looked drained.Ms. Cooper had begun confiding in her parents, with whom she was especially close. Without going into detail, she told her mother that she was worried about what her team was finding, and that it was definitely a very big deal, according to a person close to Ms. Cooper.Meanwhile, Mr. Sullivan began to ask questions about what Ms. Cooper’s team was up to. One day the finance chief approached Mr. Morse in the company cafeteria.

When Mr. Morse saw him coming, he froze. The auditor had only spoken to Mr. Sullivan twice during his five-year tenure at WorldCom.”What are you working on?” Mr. Morse later recalled Mr. Sullivan demanding. Mr. Morse looked at his shoes. “International capital expenditures,” he says he replied, referring to a separate, and less-threatening auditing project. He quickly walked away.Days later, on June 11, Ms. Cooper got an unexpected phone call from Mr. Sullivan. He told her that he would have some time later in the day, and invited her to come by and tell him what her department was upto, according to a person familiar with Ms. Cooper’s situation.That afternoon, Ms. Cooper, Mr. Smith and another auditor arrived at Mr. Sullivan’s office. They talked about pending promotions and other administrative matters, according to lawyers involved in the case.As the meeting was breaking up, Ms. Cooper turned to Mr. Smith and suggested that he tell Mr. Sullivan what he was working on. It was meant to seem like a casual comment. In fact, the two auditors had planned it out

In fact, Mr. Yates initially had refused to execute the plan when Mr. Myers told him about it, according to a person close to Mr. Yates. And in turn Mr. Myers, the controller, had argued to Mr. Sullivan that the transfer could not be justified, says a former employee. But Mr. Myers eventually passed the order down the line to Mr. Yates after he was persuaded by Mr. Sullivan that the transfer was WorldCom’s only way out of its troubles, according to the former employee.When the order landed on Ms. Vinson’s lap she felt trapped, the person close to her says. Threatening again to resign wasn’t going to help. And she was still reluctant to quit without another job. She and Mr. Normand met with Mr.

Yates in hisimmaculate office to talk about their concerns, but nothing was resolved, according to a person close to Mr. Yates.That night Ms. Vinson reviewed her options with her husband, the person close to her says. She decided to put together a resume and begin looking for a job. She didn’t think about retaining a lawyer or talking to the SEC, says this person. She hadn’t really started to think about the ramifications of her actions.At WorldCom, the wheels were already in motion to transfer the line costs. Ms. Vinson reluctantly went along. It fell to her, Mr. Normand and Mr. Yates to figure out into which of five capital accounts they should transfer the costs. As they considered the options, Mr. Myers walked into Ms. Vinson’s office and the group commiserated about how unhappy they were about the transfers. Still, they agreed they had to keep bailing water for the time being, according to a person familiar with the conversation.Ms. Vinson then made the entries transferring the $771 million, backdating the entries to February by changing the dates in the computer for the quarter, according to court and SEC documents.Ms. Vinson faced the same dilemma in the second, third and fourth quarters of 2001.

Each quarter she, Mr. Yates and Mr. Normand scraped together small amounts of liabilities that legitimately could be lowered for the quarter, hoping that they wouldn’t be required to make a large questionable adjustment. But each quarter they found themselves in the same uncomfortable spot, and wound up making giant and fraudulent entries. In the second quarter, they transferred $560 million to the capital accounts. In the third quarter it was $743 million, and in the fourth quarter it was $941 million.Ms. Vinson began waking up in the middle of the night, unable to goback to sleep because of her anxiety, says the person close to her. Her family and friends began to notice she was losing weight and her face took on a slightly gaunt look. At work she withdrew from co-workers, afraid she might let something slip, says the person close to her.In early 2002, she received a promotion, from senior manager to director, along with a raise that brought her annual salary to about $80,000, according to a former WorldCom staffer.Meanwhile, she and her two co-workers were increasingly distraught. Mr. Yates decided to look for a lawyer, according to a person close to him.

Through a cousin, he got the name of Joseph Hollomon of Jackson, a former federal prosecutor in Mississippi. Mr. Yates met with Mr. Hollomon, but unsure of what todo, didn’t retain him immediately.Ms. Vinson continued to cling to the notion that each transfer would be the last, says the person close to her. That hope was dashed in late April 2002. Ms. Vinson, Mr. Normand and Mr. Yates had just finished putting together the financial reports for the first quarter, which included an $818 million transfer of line costs. Shortly afterward, they made a discovery that spurred them finally to take action.Mr. Normand and Mr. Yates were talking about WorldCom’s 2002 financial plan, a copy of which Mr. Sullivan had circulated. Mr. Normand flipped his copy over and began scribbling on the back. Mr. Normand handed his calculations to Mr. Yates, says a person close to Mr. Yates. It suddenly was clear to both men that the line-cost transfers would have to continue at least through 2002, because there was no other way the company would be able to make its projections, say several people familiar with the discussion.

The two men shared their discovery with Ms. Vinson and they all agreed that they had had enough, say two people familiar with their decision. Ms. Vinson vowed to begin looking for a new job, says the person close to her. Mr. Yates decided to launch a job search as well and Mr. Normand decided to quit but ask for a severance package, according to internal documents and one of the people close to Mr. Yates.They made another pact as well: They would refuse to make any more improper accounting entries. Over the next few days, each of them met with Mr. Myers to tell himof their plans and their decision to make no more transfers.In March, the SEC made a request for information from WorldCom because it was suspicious about the company’s good financial results. The company’s head of internal auditing, Cynthia Cooper, started asking Mr. Myers and others about certain accounting decisions, and the entries made by Ms. Vinson and Mr. Normand.On the afternoon of June 17, Ms. Cooper and Glyn Smith, another auditor, walked into Ms. Vinson’s office and asked her to justify the transfers. Ms. Vinson said she couldn’t, and told them that the amounts were provided to her by Mr.

Yates and Mr. Myers. She suggested that Ms. Cooper talk to them, according to internal documents released by Congress. Moments later, Ms. Cooper and Mr. Smithwere in Mr. Yates’s office asking the same questions. He sent them to see Mr. Myers, according to the documents.Ms. Vinson, Mr. Yates and Mr. Normand were in a panic, say people familiar with the situation. Mr. Yates called the other two into his office and suggested they all meet with Mr. Hollomon, the lawyer he had been referred to, according to a person close to Mr. Yates. On Thursday, June 20, at Mr. Hollomon’s downtown office, they agreed on a plan: They would meet with regulators and prosecutors, tell them everything and hope for leniency. The three each contributed $10,000 to retain Mr. Hollomon.Mr. Hollomon had the three accountants sign a so-called proffer agreement with prosecutors, stating what the three were willing to tell them. Although there was no written agreement that they wouldn’t be prosecuted, several lawyers involved say the Mississippi U.S. attorney’s office had told Mr. Hollomon that the accountants would likely be viewed as witnesses, not targets of the probe.But Mr. Hollomon warned his clients that “all bets were off” if the case was moved to the Manhattan U.S. attorney’s office, which has a long history of aggressively prosecuting high-profile business cases.

The Mississippi office often emphasizes gaining cooperation from witnesses rather than targeting them for prosecution, according to several lawyers.On Monday afternoon, Mr. Yates, Mr. Normand and Ms. Vinson left their offices one at a time and drove to a Courtyard Marriott in Jackson. They told their story to an official from the SEC, an FBI agent and an assistant U.S. attorney.WorldCom’s problems were about to explode into public view. On June 25, the day after the meetings at the Marriott, the SEC got a call from WorldCom’s lawyers with a shocking disclosure: Ms. Cooper and her fellow auditors had found $3.8 billion in fraudulent accounting entries. The following day, the SEC charged the company with accounting fraud.Though the Mississippi U.S. attorney’s office had initially taken the lead on the case, the U.S. attorney’soffice in Manhattan began to play a more dominant role. Soon, Mr. Hollomon’s fears were realized. In July, after a turf war with Mississippi, the Justice Department granted jurisdiction to the Manhattan U.S. attorney’s office and it quickly became clear that the New York prosecutors had a different take on the accountants.Mississippi U.S. Attorney Dunn Lampton said he was “disappointed” he didn’t remain involved. He wouldn’t discuss his initial plans for the case.

“Deciding who to prosecute is one of the toughest decisions a prosecutor faces,” he says.Soon, Ms. Vinson’s hopes that she would continue to be viewed as a witness were dashed. On a flight to Mississippi after an interview with prosecutors in New York, Mr. Hollomon told Ms. Vinson that he was concerned that they were focusing on the fact that she had made her own decisions about which capital expense accounts she transferred the line costs into. He thought prosecutors might draw the conclusion that she hadn’t simply been following orders.Mr. Hollomon told her that Mr. Myers was cooperating with prosecutors, who now suspected that Ms. Vinson and the other accountants from the beginning had been instrumental to making the scheme work, according to the person close to Ms. Vinson.On Aug. 1, Ms. Vinson received a call from Mr. Hollomon telling her that the prosecutors in New York would probably indict her.

In the end, they viewed the information Ms. Vinson had supplied at the Courtyard Marriott as more of a confession than a tip-off to wrongdoing, people familiar with the case say.Crying, she called her husband, who was on a business trip, and reached him at the airport in Atlanta to tell him that charges against her were imminent. Within hours, she was fired because of the expected indictment. The only thing she was allowed to take with her was a plant from her desk.On Aug. 28, Mr. Sullivan and Mr. Yates were indicted, and Ms. Vinson and Mr. Normand were named as unindicted co-conspirators in the scheme. Mr. Myers pleaded guilty to three felony counts and Mr. Yates soon pleaded guilty to one count of securities fraud and one count of conspiracy to commit securities fraud.Ms. Vinson and her husband tried to think of a way out of their predicament. Unable to afford the legal bill that would result froma lengthy trial, Ms. Vinson decided to negotiate a guilty plea as well. They hoped to cut a deal that wouldn’t include a prison sentence.On Oct. 10, the U.S. attorney’s office announced that Ms. Vinson and Mr. Normand had pleaded guilty to two criminal counts of conspiracy and securities fraud, charges that carry a maximum sentence of 15 years in prison.

At a court hearing, Ms. Vinson answered U.S. Magistrate Judge Andrew Peck’s questions so meekly that he asked her to speak up. Mr. Hollomon held a microphone close to her as she read a statement admitting that she had started making the illegal entries in October 2000. “I was very concerned about the order to make the adjustment,” she said.

Description

Begin by thoroughly reading the attached Case Study document. Once you have a firm grasp of the case, you will author a paper that presents your analysis regarding decisions made by two individuals associated with the WorldCom scandal. This paper should be 4-5 pages long and in APA format. At least 3 professional sources must be cited (crowd-sourced sites such as Wikipedia are not considered to be professional and should not be used). The case study paper will be due at the end of the course in Week 7.

In 4-5 double-spaced pages, address each of the following questions:

1. What are the overall consequences of the choices made at WorldCom – to employees, to shareholders and to other stakeholders (you may need to seek out other sources to find out the specifics).

2. Describe the different choices made by Cynthia Cooper and Betty Vinson.

3. Analyze the decisions made by these two women based on the ethical approaches discussed in the text and in class.

4. Analyze the decisions made by these two women using the cardinal virtues and accounting codes of conduct.

5. What were the consequences to Cynthia Cooper and Betty Vinson both personally and professionally? Consider what happened to them during the time of the articles as well as doing research on what has happened to them since.

6. Try to put yourselves in the situation of these women and suggest improvements, if any, to the ethical decisions made by these two women that you would make based on your analysis above. How would things have turned out differently?

7. What do you recommend that would make it more likely that accountants would make ethical choices when confronted with them?

 

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