WorldCom Management

WorldCom Management

Legal Issue Impacting WorldCom

WorldCom was operating the world 's largest Internet network with a workforce of 60 ,000 spanning about 65 nations . Until the year 2002 WorldCom was USA 's second largest long distance telephone company when it got embroiled in a legal battle due to its involvement in a serious accounting scandal . WorldCom d for Chapter 11 bankruptcy protection about one month following its disclosure that it had inappropriately shown 3 .8 billion in expenses . The company became devastated by its 41 billion debt burden . Having 107

billion in assets , the bankruptcy of WorldCom is by far the largest in the history of United States surpassing that of Enron Corporation . At WorldCom bankruptcy was imminent . Under Chapter 11 , the company was allowed to carry out its functioning while it develops a reorganization plan . WorldCom arranged 2 billion in debtor-in-possession financing from Citigroup , J .P Morgan and G .E . Capital which will permit it to function while still under bankruptcy . However , the financing must be agreed to by the bankruptcy court . The fate of the company was on a downturn since late 1999 when businesses cut down spending on telecom services and equipment . During April , CEO Bernie Ebbers put in his s on the issue of about 366 million in his personal loans from the company . Ebbers joined the long-distance telephone business during 1983 (Beltran , 2002

Ethical Issue Impacting WorldCom

Sometimes ethical issues are not visible . There is an overall agreement regarding the fact that managers must not infringe laws . Following the summer of 2002 , it must be quite apparent that it does not make any meaning to violate the provisions of the law . Clearly , the managers at Arthur Anderson were imprudent to have destroyed the documents and the Chief Accountants at WorldCom committed mistake to record the expenditure of current period as capitalized assets . In the case of WorldCom mangers implicated can argue that they believed that their action came within the purview of present standards . The former CEO of WorldCom considered that he had not anything inappropriate which is not ethical . It is important to understand that people did not cross the threshold with their full knowledge . The fundamental mistake by the managers at WorldCom was treading close enough the line which is not distinctly visible and which moves in the course of time . It is worthwhile to consider that ethics is a societal concern and it can and does sometimes turn into a legal and criminal issue (Ethics Issues in Human Resource Management

Social responsibility issue impacting WorldCom

The reality that corporations cannot evade social responsibility as their activity puts a tridimensional impact i .e economic , social and environmental . Their immense political impact has rendered governments discard their fundamental responsibilities that leads to an extremely negative long-term and tridimensional effects . All these instances come into the identical category as the WorldCom deceptive bankruptcies . The common thread is the want of corporate accountability because of the severe corruption of governments that has shifted then to...