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Documenti di Professioni
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Earnings
Management
Group 4
Mai San Yadana
De Ocampo, Gezelle
Dimalibot, Danica
Endaya, Maria Angelica Mae
Zarraga, Fatima
Histo
ry
196
0
197
4
197
5
198
0
198
2
198
6
Arthur J. Rosenburg
History
(cont.)
199 Tyco International
0
199
CEO Dennis Kozlowski
2
Rumors began to spread about Tycos
199
accounting habits.
9
200 Tyco acquired more than 30 major
companies.
Tycos
scandal was taken place.
0
200
2
Introducti
Greed
on and corruption are few of the words to
describe the mismanagement of earnings
and funds of Tyco Internationals CEO Dennis
Kozlowski.
Introduction
(cont.)
In September 12, 2002, national television
showcased Tyco Internationals former chief
executive officer (CEO) L. Dennis Kozlowski
and former chief financial officer (CFO) Mark
H. Swartz in handcuffs after being arrested
and charged with misappropriating more than
$170 million from the company.
As Kozlowski rose to become the second
highest paid CEO, some red flags pointed
toward the impending disaster.
2. CFO Mark
Kozlowskis self-priority
is not observed
Transparency
Unauthorized funds came out of the
company
Misappropriations
Bribery
Accounting Fraud
High Bonuses
1.
5.
6.
Solution
Damage
Costly because of the
compensation for the
additional
committee.
Benefit
Because of additional
cost, income will be
lessen but can avoid a
large corruption even in
the top management.
Monitoring
Fairness
The additional
committee as well as
the company will
benefit, however, the
cost is situated to the
company.
The employees as well
as the company will
benefit, however, the
cost is situated to the
company.
Benefit the whole
company.
Solution
Damage
Cost is minimal.
Applicants ability
and courage can be
hard to discover.
Difficulty of the
executives in
choosing whether to
be a part of the
board or the top
management.
Benefit
Fairness
The company can ensure Benefit the whole
unbiased work from its
company.
employees.
Burden the Hiring
This can lessen the
department.
intervention of the top
management in each
departments duties.
No cost is needed.
This can lessen misuse
and overuse of power.