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Audit related issues facing Groupon company
Finance & Accounting
Pages 5 (1255 words)
Introduction Groupon Company is an online marketing firm that was first established in Chicago in the year 2008. It deals with day to day sale of coupons or discounted certificates to other firms as well as individuals.
The interested customers then purchase the coupons electronically using their credit cards or paypal which they present in those restaurants. The firm has experienced tremendous growth since its inception with expansion in over five hundred markets in about forty seven countries worldwide. In the first year of its establishment, it managed to receive revenue worth $15 million which had never been witnessed by other players in the same industry (Garner, 2008). However, it has began to experience numerous challenges including a significant drop in the price of its shares in the New York Stock exchange market after its Initial Public Offer (IPO) in the year 2011 in the month of November. Stiff competition from its major competitors such Google and LivingSocial have further pushed down the pre-tax profits of Groupon. These firms quickly adopted the techniques used by Groupon and have since emerged stronger than it. Current problems experienced by Groupon can be traced to internal control failures according to the Chicago Tribune dated September 24th 2013. Internal control failures After registering low revenue than expected in its third quarter financial report, the management of the firm admitted to weak system of internal controls as the main cause of the decline in revenue. ...
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