Auditing Essay Example | Topics and Well Written Essays - 3000 words - 1

Auditing - Essay Example Later in the year 1999, she was promoted to the post of Vice President in the department of internal audit. However, when the telecom market got saturated the profitability of the company began declining. Cynthia in the year 2002 discovered that the company used illegal practices to manipulate its accounts. It was observed that although the company suffered loss, the balance sheet showed that the company was attaining significant profit. Cynthia thus decided to carry out a secretive investigation on the fraud practices exercised by the company which then resulted to the termination of the Chief Financial Officer (CFO) Scott Sullivan. In spite of her effort to unveil the illegal accounting practices exercised by the company, she was considered as a major suspect in the federal investigation. Based on the above presented case scenario, this study intends to describe the key criteria for functioning of an effective whistle blower in the corporate level. It also discusses about the polic ies framed by the regulatory bodies to prevent the illegal accounting practices. The term whistle-blower is allocated to a person within an organisation who is engaged in the disclosure of fraudulent and illegal practices executed by employers within the organisation to other organisations or a person who are eligible to take actions for curbing such malpractice (Beller, n.d.). Concerning with case provided, Cynthia Cooper was the whistle-blower who unveiled the fraudulent practices carried in the WorldCom. Almost all organisations are widely concerned about management and employee related fraud. It is thus very important to establish a corporate whistle-blower hotline which ensures effective operation in organisations. The main objective of this hotline should be to detect wrongful accounting practices and avoid future potential illegal practices in organisations. Thus to ensure that the whistle blower hotline is