See below for the slide from today's fraud & internal controls discussion for WorldComm and Enron. Do some research and see what you can find on Tyco and answer the following questions: 1. Briefly (2-3 sentences) describe the Tyco scandal. 2. Give 2 accounting examples of how the Tyco fraud was committed (see the examples from WorldComm and Enron). 3. For each example from 2 above, which internal control principle was missing and why? WorldComm - Booking "costs" as capital expenditures on the balance sheet instead of as expenses - Inflating revenues with bogus accounting entries from "corporate unallocated revenue accounts" Enron - Creating numerous "special purpose entities" to transfer liabilities so that it would not appear in its accounts - Debts/losses were put into "offshore" entities that were not included in the company's financial statements Tyco - See what you can find