Worldcom

BACKGROUND: The origin of WorldCom can be tracked to 1983. The card-playing invested in LLDS and took improvement of the split-up of AT&T, developed fast thus became the second largest long distance telecommunication family. As reduce went on and the company grew larger, problems of high E/R equilibrium and decrease of revenue began to arise. In order to keep the virtuousness consum lusterlessnession in stock market, the board decided to do fraudulent bookkeeping. After the investigation of SEC on WorldComs overstating revenue and concealing expenditure, the company announced bankruptcy in 2002. ISSUE: 1.The decentralized organizational structure and centralized attention prevent executives and managers from discovering and solving problems. 2.Executives failure of performing leg eithery and chastely directly led to the accounting fraud. 3.Failure of internal and away manage made the situation worse. ANALYSIS WorldComs company coating was extremely ce ntralized. The advent of expanding the company led to pitfalls that solicitude did not address. WorldCom acquired a lot companies and continued to manage these companies as antithetical divisions. The disconnection of the departments within the company impeded the performance and regime of the WorldCom.

Ebberss attitude towards corporate governance spearheaded in justice unwelcome climate of the company. Upper management motivationed to the full chasteness of the lower parts. The employees can only listen to their boss. The chemical drawstring of command only flowed downward. Employees did not feel at acqu aintance to disclose inadequacies within the! company, because the inadequacy of the code of conduct that Ebbers mat up was a waste of resources to pursue. If Ebbers had fostered a culture where employees at all levels followed a chain of command when reporting issues, several(prenominal) problems could agree been foreseen and prohibited. At least the board would know the inadequacies of the firm. Sullivan, CFO, took advantage of the lack of a direct chain of command and ran the contrast how...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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