Defects in the companys system, Financial Management

Assignment Help:

The case of McKesson & Robbins scandal (1938) was happen due to internal fraud. This case is also happen by the faulty work of board of directors. The organization of McKesson & Robbins, Inc. had been taken on by Phillip Musica in the year of 1925. Musica also used a assumed names by that he did hide his original identity and due to this he did take the control of management in two companies. In the context of Adelphia Pharmaceutical, Musica used the name such as Frank D. Costa and also used F. Donald Coster for the organization of McKesson & Robbins. Even though, Musica was expanded the legitimate the business operations of the company successfully. But he also recruited his brothers in both the organizations by their hiding identity in which his two brother took the part inside the company and one did his work from the outside of he company (Clikeman, 2008). With the help of this, Musica generated fake documents related to the sales of company and also paid huge commissions to the company of shell distribution by the help of their control. They also made internal transactions for them and also made the assets about the $20 million by making phony balance sheet.

There was several defects in the internal systems of the company by that Musica did non ethical work and also made huge money for their self on the basis of companies assets. The internal audit of the company also was weak and the recruitment system of the  company by that Msica did  make huge money. Hence, the management would use the audit tests of internal controls that would help the auditors to stop the internal misconduct (Clikeman, 2008). With the help of this, the organization would improve the internal systems of the company also reduces the internal fraud.


Related Discussions:- Defects in the companys system

financial crisis, Hedge funds are short two types of funding options. Desc...

Hedge funds are short two types of funding options. Describe in detail what these options are.   Describe why these options become more valuable during a financial crisis.   During

Illustrate the operating leverage, Q. Illustrate the Operating Leverage? ...

Q. Illustrate the Operating Leverage? Operating Leverage: - The operating leverage perhaps defined as the tendency of the operating profit to differ disproportional with sales.

Business proposal of a pet care shop, With the advent of globalization ther...

With the advent of globalization there had been much importance which is being given to the issues related to the general health of pets and other associated services as the people

Example of relationship between bond price and time, Illustration    ...

Illustration      Discount bond (5 yr. bond with 10% coupon) (expected rate yield at 12%) Premium bo

Future value, (a).At the end of three years, how much is an initial deposit...

(a).At the end of three years, how much is an initial deposit of $100 worth, assuming a compound annual interest rate of (i) 100 percent? (ii) 10 percent? (iii) 0 percent? (b).b. A

Sinking fund provisions, Sinking fund provisions is a pool of funds s...

Sinking fund provisions is a pool of funds set aside to repay the debt. Under this, certain amount of money is kept aside every year form profit. It is then used

Evaluate the strength of the human development, In 2005, Mr. Gordon Brown's...

In 2005, Mr. Gordon Brown's brought up a plan of action to help reduce poverty and boost economic development in Africa. The three essential elements of the 2005 development plan

Eurobonds, The term 'Eurobonds' refers to bonds issued and sold outsi...

The term 'Eurobonds' refers to bonds issued and sold outside the home country of the currency. For example, a dollar denominated bond issued in the UK is a Euro (

Modern / discounting cash flow techniques, Modern / Discounting Cash Flow T...

Modern / Discounting Cash Flow Techniques : These methods generally are of more use to businesses in their investment decisions. They take into account the time value of money and

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd