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The WorldCom and Eron accounting scandal involved the firm classifying operating expenses as capital investments. Discuss the impact on Eron and WorldComs operating cash flow

The WorldCom and Eron accounting scandal involved the firm classifying operating expenses as capital investments. Discuss the impact on Eron and WorldComs operating cash flow and their overall cash position. Did the financial statements contain any clues that could have warned investors of the fraud ? Could the Eron debacle have been prevented ? What actions could have been taken by auditors, regulators, and lawmakers ?

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