The Case of Phar-Mor Inc
Read “The Case of Phar-Mor Inc.” which can be accessed through the DeVry online library. In 3-4 pages (12-pt type, double-spaced) summarize the case and answer the following questions:
1. Could SOX have prevented the Phar-Mor fraud? How? Which specific sections of SOX?
The appropriate response is begging to be proven wrong because the degree that Phar-Mor went to conceal the extortion it might have taken quite a while still to reveal it notwithstanding, over the long haul I do trust SOX would have kept the misrepresentation from enduring just about an entire decade without being identified, and would not have been revealed had it not been for a shriek blower. I think the most vital areas of SOX that would have revealed the misrepresentation at Phar-Mor are as per the following – Section 203 – Which manages the examiners and any conceivable irreconcilable circumstance in the event that they had worked with Phar-Mor in the last timetable year they would have not possessed the capacity to be similar evaluators doing last reviews of the organization. – Section 206-Which expresses that any examiner who had beforehand worked for the firm and now works for Phar-Mor would make the firm not have the capacity to have Phar-Mor as a customer. Phar-Mor had 3 previous representatives of the review firm who worked for them which permitted them the information to realize that the examiners wouldn't check for specific things and certain records in the event that they indicated zero adjust. – Section 404 – Which requires that the inward controls to be evaluated and tried once per monetary year. This would have helped the extortion be revealed much sooner since the inspectors would have looked at over the stock techniques and the misrepresentation would have been found years sooner. …show more content…
The Waste Management outrage was one were execution based pay was being utilized so administrators in view of the organization's main concern go bonus's, investment opportunities, and higher pay rates. The administrators at that point thus sold those investment opportunities just before the bottom fell out making a great many dollars on the stocks. The organization's financial specialists lost aggregate 6 billion dollars because of the misrepresentation one of the greatest misfortunes to date around …show more content…
Research the Enron scandal from the early 2000’s. Describe the scandal. Could SOX have prevented this scandal?
The Enron embarrassment is one of if not the most surely understood extortion of the present time. Enron's extortion is one of the principle reasons SOX was instituted. The Enron outrage was one of cooking the books which enabled Enron to drive up their stock costs and simply like the Waste Management embarrassment enabled officials to gather high pay rates and motivating force based bonus's.
Enron was a mobile irreconcilable circumstance the CFO additionally ran Enron's backups and the CEO, President, and CFO all sat on the leading body of Enron. This is the thing that enabled the misrepresentation to run so easily for many years. The other issue was Enron chosen not to see when their worker's additionally begun to soften SEC controls up respects to stock exchange, and control. SOX could have effectively counteracted Enron one if would have happened after the Waste Management embarrassment, so Arthur Andersen would have never possessed the capacity to be required with the Enron
Read “The Case of Phar-Mor Inc.” which can be accessed through the DeVry online library. In 3-4 pages (12-pt type, double-spaced) summarize the case and answer the following questions:
1. Could SOX have prevented the Phar-Mor fraud? How? Which specific sections of SOX?
The appropriate response is begging to be proven wrong because the degree that Phar-Mor went to conceal the extortion it might have taken quite a while still to reveal it notwithstanding, over the long haul I do trust SOX would have kept the misrepresentation from enduring just about an entire decade without being identified, and would not have been revealed had it not been for a shriek blower. I think the most vital areas of SOX that would have revealed the misrepresentation at Phar-Mor are as per the following – Section 203 – Which manages the examiners and any conceivable irreconcilable circumstance in the event that they had worked with Phar-Mor in the last timetable year they would have not possessed the capacity to be similar evaluators doing last reviews of the organization. – Section 206-Which expresses that any examiner who had beforehand worked for the firm and now works for Phar-Mor would make the firm not have the capacity to have Phar-Mor as a customer. Phar-Mor had 3 previous representatives of the review firm who worked for them which permitted them the information to realize that the examiners wouldn't check for specific things and certain records in the event that they indicated zero adjust. – Section 404 – Which requires that the inward controls to be evaluated and tried once per monetary year. This would have helped the extortion be revealed much sooner since the inspectors would have looked at over the stock techniques and the misrepresentation would have been found years sooner. …show more content…
The Waste Management outrage was one were execution based pay was being utilized so administrators in view of the organization's main concern go bonus's, investment opportunities, and higher pay rates. The administrators at that point thus sold those investment opportunities just before the bottom fell out making a great many dollars on the stocks. The organization's financial specialists lost aggregate 6 billion dollars because of the misrepresentation one of the greatest misfortunes to date around …show more content…
Research the Enron scandal from the early 2000’s. Describe the scandal. Could SOX have prevented this scandal?
The Enron embarrassment is one of if not the most surely understood extortion of the present time. Enron's extortion is one of the principle reasons SOX was instituted. The Enron outrage was one of cooking the books which enabled Enron to drive up their stock costs and simply like the Waste Management embarrassment enabled officials to gather high pay rates and motivating force based bonus's.
Enron was a mobile irreconcilable circumstance the CFO additionally ran Enron's backups and the CEO, President, and CFO all sat on the leading body of Enron. This is the thing that enabled the misrepresentation to run so easily for many years. The other issue was Enron chosen not to see when their worker's additionally begun to soften SEC controls up respects to stock exchange, and control. SOX could have effectively counteracted Enron one if would have happened after the Waste Management embarrassment, so Arthur Andersen would have never possessed the capacity to be required with the Enron