Savannah State University College of Business Administration students will demonstrate the ability to recognize ethical issues confronting them and the ability to use ethics-based reasoning.
What Was the Project?
3111 - ACCT - Intermediate Financial Accounting I A research project is to be completed on an actual case of a multinational company which, in the last 5 years, has been alleged of accounting fraud and misleading investors and other external users of their financial reports/financial statements due to irregularities in the application of accounting theory and generally accepted accounting principles. The research paper is to be approximately 600 – 800 words long and should include a minimum of four source references. The paper should include the following:
Define the accounting problem. Describe (i) what accounting theories and accounting principles (U.S. GAAP or IRFS?) were not followed, (ii) what the financial impact of those irregularities were, and (iii) what non-financial outcomes resulted from the accounting errors, irregularities and/or fraud?
Discuss the impact of (i) whether the company’s financial reporting is priniciple-based or rule-based, and (ii) whether the accounting standards are set in the private sector or public, regulatory sector. What was the impact upon external users of the company’s financial statements, including an evaluation of whether there was any impact on either the U.S. or global financial markets
Based upon your review and analysis, (i) what steps could have been taken to avert the financial accounting irregularities, (ii) what are the lessons learned and (iii) what measures can this company’s management take now to remedy the outcomes.
Without ethics, accountants (whether acting individually or in collusion) have the most access to opportunities to commit ethical violations. Fannie Mae and Freddie Mac ethically defrauded most of America during one of the more tender economies in recent history. Whole books can be, and have been, written on the fraud committed by Fannie Mae and Freddie Mac, this work only seeks to gain and discuss a brief understanding of a very vast case of financial and accounting fraud.
Why Was THIS Project Chosen as an Example?
As someone that is going forward with a career not only in business, but in accounting, this project is especially relevant. Of all the different focus points in the business world, accounting is one where Ethics is as important as knowing the technicalities of the discipline. This is why my ethics piece is from my Intermediate I Accounting class. I really enjoyed writing this paper, and I enjoyed the conversations that I have entered as a direct result of this essay.
Fraud in Fannie Mae and Freddie Mac: A Research Project
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