WorldCom: The Accounting Scheme Backfires
In the early 2000s, the telecom industry, which had experienced wild growth since the mid-1980s breakup of AT&T, began to unwind. In response, the management team at WorldCom embarked on a fraudulent scheme to maintain its favored status with investors. Are there other instances in which short-term "good numbers" create long-term problems for financial managers? This case teaches students about the implications of WorldCom's crimes and poses larger questions about truth in accounting.
Case id: 080108
Supplemental Material: Teaching Slides