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Articles SEC fraud charges against Computer Associates International – sanjay kumar Charge: kept its books open to record revenue from contracts executed after the quarter ended in order to meet Wall street quarterly earnings estimates. Prematurely recognized revenue from contracts that had not yet executed. Complete disregard for GAAP rules WorldCom and other recent frauds Use risk-based approach to auditing. But not being appropriately integrated: auditors failing to fully evaluate controls. Because it looks for CEOS with intent to fraud. WorldCom – improperly capitalized about 4 billion in ordinary expenses in order to allow the company to deduct expense over a period of decades rather than writing it off at once Riteaid – put amount into internal reserve account which is illegal because it absorbs operating expenses and inflates operating income Bristol-Myers – improperly inflated revenues Anatomy of Financial fraud HEALTHSOUTH corporation’s cumulative earnings were overstated. Accounting
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This note was uploaded on 02/20/2009 for the course AEM 221 taught by Professor Little,j. during the Fall '08 term at Cornell University (Engineering School).

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