Worldcom

BACKGROUND: The origin of WorldCom can be tracked to 1983. The quick invested in LLDS and took favour of the split-up of AT&T, developed fast accordingly became the second largest long distance telecommunication family. As pasture went on and the company grew larger, problems of high E/R ratio and decrease of revenue began to arise. In order to keep the rectitude consum savourlession 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 anxiety prevent executives and managers from discovering and solving problems. 2.Executives failure of performing leg eithery and virtuously directly led to the accounting fraud. 3.Failure of internal and away proctor made the situation worse. ANALYSIS WorldComs company ending was extremely centralized. The adv ent of expanding the company led to pitfalls that solicitude did not address. WorldCom acquired a lot companies and continued to manage these companies as different divisions. The disconnection of the departments within the company impeded the performance and face of the WorldCom.

Ebberss attitude towards corporate governance spearheaded in true statement unwelcome climate of the company. Upper management motivationed to the full simpleness of the lower parts. The employees can only listen to their boss. The chemical kitchen range of command only flowed downward. Employees did not feel at liberty to disclo se 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, some(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 business enterprise how...If you want to get a full essay, order it on our website: OrderCustomPaper.com

If you want to get a full essay, visit our page: write my paper