1. During this past semester, we have extensively examined the Worldcom fraud (based on Harvard business school article by Robert Kaplan) and its relation to accounting and financial statements. We have seen that the fraud involved essentially three areas in accounting:

1. Acquisition Accounting Issues

2. Accrual Accounting Issues

3. Capitalization & Expense Accounting Issues

1. Discuss each of the above issues vis--vis the Worldcom case and identify the specific line items on each of the Financial Statements that were impacted and how they were impacted by the fraud.

2. In addition, discuss the Fraud Triangle and cite examples in the Worldcom story which illustrate each one of the elements in the Fraud Triangle. What, in your opinion, could have been done differently to mitigate each one of these three elements and possibly prevent future Worldcoms ?