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Unit 1 Discussion
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- AC503
- Institution
- Purdue University
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Unit 1 DiscussionThe piece I read broke out the responsibilities of both internal and external auditors in the
WorldCom case, which I thought was interesting. It describes Cynthia Cooper, who signed up
with WorldCom in 1994. She worked for the corporation as an internal auditor, doing operational
audits, and assessing output. However, Arthur Andersen, an external auditor, was tasked with
confirming the financial accounts. Cooper found some differences and was advised not to look
into this anymore.
She concluded that it would be best to look into these differences further. It was because of her
investigation that improper accounting entries were revealed. This therefore resulted in Scott
Sullivan's firing and Myers' resignation. Arthur Anderson, the external auditor, disregarded the
WorldCom danger. He informed the audit committee that WorldCom's financial reporting was
correct. The corporation was thoroughly audited by KPMG LLP, a brand-new external auditing
firm, the following year. A new external auditing firm enters the market and accurately conducts
an audit of the company as a result of the internal auditors' efforts uncovering financial statement
fraud.
As soon as it is practical, the firm will release its unaudited financial accounts for 2001 and the
first quarter of 2002. The business will deliver fresh audited financial statements for all necessary
periods at the completion of an audit. Regarding its financial recommendations, WorldCom is
also examining it (Pandey & Verma, 2004). This article's ability to convey Cynthia's unwavering
will to find the truth is what I found appealing. If she persisted in seeking the truth, she didn't
seem to care that she would lose her career. She later won the title of Person of the Year from
Time Magazine.
Reference
Pandey, S. C., & Verma, P. (2004). WorldCom Inc. Vikalpa: The Journal for Decision
Makers, 29(4), 113–126.
https://doi-org.libauth.purdueglobal.edu/10.1177/0256090920040409
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