Question - In 2002, the executives at telecommunications giant WorldCom perpetrated accounting fraud that led to the largest bankruptcy in US history. The company improperly booked about $4 billion as capital expenditures. WorldCom did not account for expenses when it incurred them, but hid the expenses by pushing them into the future, giving the appearance of spending less and therefore making more profit.
Use the Internet and e-library to answer the following questions as it relates to the financial fraud at the WorldCom.
1. Explain the key elements of the accounting fraud committed by WorldCom executives
2. Discuss the role of the external auditors related to WorldCom accounting fraud
3. Explain how the fraud was detected
4. Discuss how this accounting fraud affected the accounting and auditing profession.
5. Do you think that the US needs more laws and regulations to prevent managers from committing such accounting fraud?