Mr. Cowell admitted to Prosecutor Sean Berkowitz that he illegally manipulated the reported income of the company. Lay and Skilling stated that there is no fraudulent activities in the company after they were being contend by the prosecutor, regarding their knowledge of illegal accounting scheme to support the unstable condition of the company, months before it landed to bankruptcy.
Further, Mr. Cowell testified for the half million dollars he paid to the Securities and Exchange Commission in order to resolve civil accusation pertaining to the illegal accounting of the company's income.
According to the Securities and Exchange Commission, Mr. Cowell was also involved in other plans such as increasing the book value of one oil and gas company to appear that target quarterly earning was being achieved, and the hiding of million of dollars losses through the company's trading activities. Similarly, beyond expected trading profits were set aside, to be reported in the coming quarters and give the company an image of success.
In view of the above article, the following questions may be raised, how much confidence do investors need to place in their trusted business How can they ensure that company reports like balance sheet reflects the true financial condition of the business, and not one of those balance cheat
Financial scandals, breach of integrity and system deregulations are not new in the business world, however they ...Show more