This week’s discussion will be more of an open forum to express your views and opinions.
By Wednesday, after reading chapter 8 and the online articles you chose, please post your thoughts and opinions about the Sunbeam case. Support your comments with facts you learned in the articles you read.
By Sunday, reply to a classmate. Cite the classmate’s name in the reply. Share your ideas about how Sunbeam’s financial statement fraud and company failure could have been prevented
After reading the chapter and some online articles from The Washington Post and CNN Money, I am shocked to find that this guy, Albert Dunlap, was even viewed as a hero on Wall Street! How could he get away with all the damage he caused to many? How could the SEC disregard some of his questionable activities just because he was a well-respected man on Wall Street? How could professional and well-educated people tolerate such abusive behavior from an individual? According to the Washington Post, he was cruel to co-workers and even threw a chair at Sunbeam’s HR Chief!
Additionally, I cannot believe the charges against Albert Dunlap and Russell Kersh. Dunlap only paid a $500K fine to the SEC and was permanently banned from being an officer of a public company. Kersh, on the other hand, had to pay $200K, while the accounting firm Arthur Andersen had to settle for $110 million.
I agree with some of my classmates above, this is by far the most interesting case in the course. This week’s material truly sparked a variety of emotions and questions in me. It also reinforced many ideas of what is good and bad in the business world. For example, employees, Dunlap obviously had no regard for employees of any rank, and he was absolutely wrong. Companies need to care for their employees as they are the most important asset of a company, if the company takes care of the employees, the employees will take care of the company. The company would also reduce any pressures that would trigger fraud.
The case is also a personal reminder to be careful throughout my career in finance and accounting and to think about what I would do if I ever witnessed fraud or was pressured to commit fraud by upper management. This can truly happen to anyone, and this course is a great way to gain knowledge on how to avoid and remove ourselves from these situations to avoid tragic consequences.
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