GroupAssignment Fraud at WorldCom - WorldCom fraud....

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WorldCom fraud. Corporate Culture (Anita) Description of audited area We reviewed the corporate culture of WorldCom to identify those areas of deficiency where positive improvements could be made. The following major areas for operational improvement were noted for your review: 1) Composition of Worldcom . Per the review of the composition of Worldcom, Team B., Inc determined that Worldcom is a conglomerate of companies that lack synergy. Each of the departments within the firm has their own set of rules which continues to promote discontinuity. In addition, the systems that were adopted with the acquisition of the companies are incompatible. This makes it difficult for the company to feel like one firm and know the intricacies of the business. 2) Tone at the top. Per review of the message that is being sent from the executives at the firm, Team B., Inc determined that the communication is negative. The message that is being sent to the employees is one that is unhealthy for the corporation. According to our interviews the employees feel as though they are always being told what to do and that the management does not value their intelligence. In addition the employees do not feel that they have the opportunity to express any of their concerns confidentially. 3) Incentive Awards. Per the review of the incentive program of WorldCom, Team B., Inc determined that WorldCom does not have an adequate incentive program. We could not locate an official policy or procedures for the incentive program. Normally, a typical incentive program would have standards that would have to be followed in order for a bonus to be given. For WorldCom, special rewards are distributed without the proper authorization or approval. Quantification of Findings The corporate culture is an intangible item that does not have any direct financial impact to the firm. However, if the following recommendations are not implemented soon, the going concern of WorldCom will be compromised. The life of the corporation depends on WorldCom's ability to address the preceding findings. Summary of Recommendations 1) Composition of WorldCom . Team B., Inc suggests that WorldCom does a major reorganization in order to ensure that all necessary functions are centralized. The executive team should make a decision about the major corporate functions (accounting department, marketing department, administrative functions, etc.) and make sure there is only one department for each function for the entire firm. WorldCom should also make sure that the technology department ensures that all of the systems are compatible and in sync. 2) Tone at the top . Team B., Inc suggests that WorldCom implement ethics and compliance training for all of the employees and the management. The Board of Directors should also set the corporate standards for the management team. We also suggest that WorldCom implement
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a hotline so that employees can feel comfortable enough to express any concerns anonymously.
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GroupAssignment Fraud at WorldCom - WorldCom fraud....

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