Worldcom - Public Relation Group

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Table of Contents

Overview:        

Identified and Analysed Ethical Issues faced by WorldCom and also Applied Appropriate Theoretical Approaches To WorldCom Business Ethics are:        

Accounting Fraud:        

Financial Misconduct:        

Improper pressurised Management and Culture:        

Accounting basic principles not followed:        

Decisions to resolve the ethical issues faced by WorldCom are as follows:        

References        

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Overview:

[pic 8]WorldCom was started in 1983 when businessmen William Rector and Murray Waldron plotted a plan to make a long-distance telephone service provider on a napkin in a café in Hattiesburg, Mississippi. It was started as a small organisation in 1984 known as Long Distance Discount Services (“LDDS”) that developed to turn into the third biggest telecommunications organisation in the United States because of the management of Chief Executive Officer (“CEO”) Bernie Ebbers who was recruited in 1985 also an early investor of the company and became its CEO. It comprised of 85,000 workers as an employee at its peak with a presence in more than 65 countries. It went public four years later. In 1995, the company changes its name to WorldCom. (Ashraf, 2011)

During 1990’s, the organisation started to grow through series of successful acquisition and merger. Ebbers helped small investment to grow into a $30 billion revenue generating company characterized by sixty acquisitions of other telecomm businesses in less than a decade. In 1999, Ebbers was one of the richest Americans with a $1.4 billion net worth.

 However, during the late 1999, the company’s execution began to slip due to very high competition, overcapacity and reduced request for telecommunication facilities at the beginning of the financial decline and the impacts of the dot-com breakdown. Other than that, dropping telecommunications businesses and new competitors were radically falling their costs leads WorldCom. All these high burdens caused WorldCom to involve in accounting fraud.

Several other top management personnel were also part of fraud. They were: (Schueller, 2012)

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Scott Sullivan - WorldCom's former                                            David Myers - Controller and[pic 10]

Senior Chief Financial Officer.                                                       Vice president of WorldCom                                          

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