There are many lessons to be learned from the barrage of fraud hammering corporate America ' including how to spot signs of future impropriety. In a gripping, intriguing read, Business Fairy Tales uses real-world scandals to illustrate the seven most common frauds. It explains each fraud with a detailed, engaging story of the company and its officials that committed the most spectacular incident of that kind of financial reporting fraud. It goes behind the scenes to describe the organization's acts of deception to the public, as well as the character failures of the leaders. In addition to the specific cases, the book presents a compelling argument for the kind of reform that is needed within the industry. Ultimately, it equips and empowers readers with the skills to spot potential signs of fraud in financial statements so that they can be forewarned of future financial shocks. An appendix presents a list of publicly traded companies whose financial statements contain signals that may indicate an overstatement of assets or profits or an understatement of liabilities.
Table of Contents
TABLE OF CONTENTS. Acknowledgments v. 1. Gold Dust: Introduction to the Problem of Fictitious. Financial Reporting 1. Table 1.1 The Top Twenty Methods of Fictitious. Financial Reporting. 2. The Sizzling Saga of Sunbeam. Part 1: The History of Sunbeam. Part 2: The History of Al Dunlap. Part 3: Dunlap?s Carrot-and-Stick Approach. Part 4: An Overview of Sunbeam?s Fictitious Financial Reporting Schemes. Part 5: The Sunbeam Inferno. Part 6: Signals of Sunbeam?s Schemes. 3. Hocus Pocus. Sensormatic: Madness at Midnight. Xerox: Not to be Copied. CUC/Cendant: Phony Funds. Insignia: Return to Sender. 4. WorldCom Wizardry: From WorldCom to World-Con. Part 1: The Wizards of Worldcom. Part 2: The Acquisitions Spree. Part 3: Problems in Wizard World. Part 4: An Overview of WorldCom?s Fictitious Financial. Reporting Schemes. Part 5: The Collapse of Wizard World. Part 6: The Gatekeepers Who Failed WorldCom. Part 7: Signals of the WorldCom Fraud. 5. Abracadabra. Livent: Phantom of the Finances. Rite Aid: "The Keys to the Kingdom". Allegheny (AHERF): Trick or Treatment? Lockheed: Sky High. 6. Enron and the Tale of the Golden Goose. Part 1: Hatching the Goose: The Start of Enron. Part 2: Fattening the Goose: Enron Capital and Trade (ECT). Part 3: Plucking the Goose: How Enron Lost Its Gold. Part 4: Stuffing the Goose: The Electricity Fiasco in California. Part 5: How Enron Cooked the Books: The Main Fictitious Financial Reporting Schemes. Part 6: Signals of the Enron Fraud: Indications That Enron was a Cooked Goose. 7. Tall Tales. The Edison Lesson. The Adelphia Account. The BellSouth Warning. Krispy Kreme and the Missing Dough. 8. The Pension-Fund Fantasy. Part 1: The Disappearing Pension. Part 2: The Alchemy of Pension Accounting. 9. Reform: Is There a Magic Potion? Part 1: Introduction. Part 2: Corporate Governance Reform Since 2002. Part 3: Emerging Reform Issues. Table 9.2 The Top Twenty-Five Signals Indicating Possible Fictitious Reporting in Financial Statements. Epilogue The True Philosopher?s Stone: Making Ethical Decisions in the Business World. Accounting Abbreviations. Index.