Brushing up HBR fundamentals will provide a strong base for investigative reading. Often readers scan through the business case study without having a clear map in mind.
The company went public as a corporation in after merging with Advantage Companies Inc. Significant acquisitions included the takeover of MCI, which made it the second largest U.
In the company had an employee base of 85, workers with a presence in more than 70 countries.
From the outside, WC appeared to be a strong leader of growth. In reality, the appearance was nothing more than a perception. As a result investors in WC have suffered major losses: However, increase in the number of services and the products are mainly attributed to the new acquisitions and mergers with new companies.
During the pick of the business, WC provided mission-critical communications services for thousands of businesses around the world, owned and operated a global IP Internet Protocol backbone that provided connectivity in more than 2, cities and in more than countries.
It also owned and operated 75 data centers on five different continents. Merger and Strategy was the key for WorldCom growth strategy Throughout its journey since the inception WC choose merger and acquisition strategy for its growth. The company evolved into the second largest long distance telephone company in the United States and one of the largest companies handling worldwide Internet data traffic through the successful completion of 65 acquisitions.
Two of these acquisitions were particularly significant. The top management explored this advantage high stock price to use WC stock as the vehicle to continue to purchase additional companies.
With the acquisition of MFS Communications and its UUNet unit, "WC suddenly had an investment story to offer about the value of combining long distance, local service and data communications. It engaged in nearly 70 merger and acquisition deals in less than five years but did not focus on integrating organizational culture, structure and appropriate management control mechanisms.
As a result, it was observed that by the early s, the revenue of the company was diminishing. Furthermore, it was facing an emerging problem in s of oversupply in telecommunications as the industry rushed to build fibre optic networks and other infrastructure based on overly optimistic Internet growth projections.
WC and other telecommunications firms had experienced reduced demand as the internet boom ended and the economy entered recession. Their revenues had fallen short of expectations, while debt taken on to finance mergers and infrastructure investment remained.
In this circumstance, the desire to conceal the bad news on company earning from the stock market investors created a powerful incentive for the top management to engage in fraudulent accounting reporting [ix].
Several employees were involved, including: WC paid various fees to use or lease facilities belonging to third parties. Normally, these fees were reported as an expense on the income statement, which were filed with the other financial statements on a quarterly and annual basis.
Typically this guidance pointed toward continued positive growth in earnings. The fees paid for leasing were the primary drivers of this increase. This series of transactions had the effect of increasing net income.
This activity continued until June [xv]. During this time, WC did not disclose these transactions to their external auditing firm, Arthur Anderson. The transactions were also not reported in SEC filings [xvi].
The fraud committed at WC was uncovered by a team of internal auditors in [xvii]. The discovery was brought forward to the internal audit committee and board of directors. Once the board knew, several executives at WC were either fired by the board, or resigned, and the SEC began their investigation.
The first stage of the research component involves becoming familiar with the WC scandal from archives of reputable newspapers and business magazines. We will also seek peer-reviewed academic journals for more details and insights into the incident allowing us to conduct an analysis of the role management controls played in the fiasco.
As the purpose of this research is to seek for academic standard or frameworks in the above mentioned areas, we should rely on information or publications from regulators, or generally accepted principals, such as US-GAAP.
We may obtain information from academic, peer- reviewed journals.
This research will be conducted concurrently with the studying of the WC fiasco as it does not require any sequence and therefore, can be conducted independently. The causes, the Characteristics, the consequences, and the lessons learned [iii] Ibid,p-2 [iv] Eichenwald, Kurt Wall Street Journal October 8p.Equity scholarships support students receiving a Centrelink disability support pension, single parenting payment or carer payment.
These scholarships are administered by the Universities Admission Centre (UAC).
Nov 17, · MCI Communications Corporation was acquired by Verizon Business Global LLC. In September , MCI Communications Corporation merged with and into TC Investments Corp., a wholly owned subsidiary Location: Pennsylvania Avenue NW Washington, DC United States.
MCI COMMUNICATIONS CORPORATION Introduction In , the Justice department ordered the separation of ATT into local subsidiaries. MCI was one of the main competitors of AT&T and the impact of this new competition on MCI was uncertain. WorldCom pursued scores of increasingly large acquisitions.
The strategy reached its apex with WorldCom's acquisition in of MCI Communications, a company with more than two-and-a-half times the revenue of WorldCom. For online chat appointments, due to the slower nature of type chat, we recommend you make an hour-long appointment if the session involves an essay that is more than one or two pages, or if you want to talk about several aspects of writing.
Look for two white boxes in a row and after you click on a box, change the timeframe to span an hour. Mergers and acquisitions (M&A) are transactions in which the ownership of companies, other business organizations, or their operating units are transferred or consolidated with other schwenkreis.com an aspect of strategic management, M&A can allow enterprises to grow or downsize, and change the nature of their business or competitive position..
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