Business, law, and ethics Essay Example | Topics and Well Written Essays - 500 words

Business, law, and ethics - Essay Example The first challenge that was experienced by the Company occurred when the Chief Executive Officer, Bernie Ebbers employed Sullivan who was later promoted to the post of a Chief Financial Officer. Sullivan apparently did not possess proper inter-personal skills and his appointment created irritations among the divisional managers. This was also confirmed by the occurrence of conflicting ideas between Sullivan and Sidgmore. The failure of the Company was later propagated by the series of law suits that were experienced when some of the customers complained for fraud and over-charging of the services offered by the Company. The Company had to pay fine in order to compensate these customers hence undergoing massive reduction of profits. Moreover, was blocked on its bid to acquire the shares of Sprint in the year 2000; this was blocked by the regulatory authorities (Justice Department) hence leading to a fall of the share price of the Company. Many people speculated that the World Com Company was at a brink of failing and soon could start selling its shares. Huge amounts of loans were also given to Bernie Ebbers that amounted to 341 million USD; an audit by an external Company also indicated that Ebbers had used some large amount of the Company’s money to perform his personal activities hence exposing the Company to a financial crisis. To begin with, it is evident that the World Com Company did not undertake frequent financial audit hence giving the accountants ample time to conduct fraud and embezzlement of funds; this should have been the first step undertaken to promote transparency in finance department. Auditing would have led to the determination of such problems at an early age hence leading to formulation of effective solutions. Additionally, it is apparent that the top management team, specifically, the Chief Executive