Waste Management Fraud
What were the incentives and pressures that led to the fraud?
There are different factors for the incentive or pressure to lead fraud in the cooperation because the working conditions were not followed the accounting procedure operation and they are not anti-irregularity accounting operation. The management and employees have an incentive that was the reason for committing fraud since the absence of well-organized internal controlled auditors was inefficient controls, and an inefficient management system. The other additional factor was the attitude and the ethical value of the dishonest character of the management and employees were also not honest and, followed their management fraud activities.
Buntrock benefited the most from the Waste Management fraud. Research and summarize what happened to Buntrock and evaluate if he may have felt the risk worth the reward. Include any articles you used in your evaluation.
Buntrock was the founder of west management, the chairman of the board of directors, and the chief executive officer. He was also set on how to get high earnings by changing an accounting system, he also established the donating system by inflating the company stock to his own St. Olaf College to get a large amount of the tax benefit. He was the first beneficiary of the fraud and received $16.9 million as a bonus since the increase in company revenue. He also got the retirement benefit. He also got a commission and another different payment benefit from the cooperation and was suspended from any public company services. https://www.sec.gov/litigation/complaints/complr17435.htm
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Research what happened to at least three of the Waste Management executives (other than Buntrock) named in the chapter (Rooney, Koenig, Hau, Tobecksen, and Getz).
Rooney was the president of the cooperation and chief operating officer after Buntrock. He received bonuses of about 9.2 million dollars because of the growth of the company revenue, performance, retirement benefits, retirement benefit and the sale of company stock during the fraud, but according to the SEC investigation and based on the result Rooney paid 8,692738 these were comprised of disgorgements, prejudgment interest, and a civil penalty. Getz was another executive management to the West management cooperation, and he was the senior vice president and general counsel, and secretary of the company. He was the accounting fraud maker in the cooperation, and based on the SEC paid 1,149.756, and also suspended any public company service for limited years. https://www.sec.gov/news/headlines/andersenfraud.htm.
What happened to the auditing firm of Arthur Andersen as a result of their Waste Management audits? Summarize what happened to each executive (include links to your articles). Do you think these consequences were appropriate?
Arthur Anderson was the largest public accounting firm owner which employed more than eighty thousand in the year of 1990s, but he was mad an accounting fraud in 2002, and he got a civil penalty to pay around #7 million with the three partner auditors based on the SEC in connection with the audit of the west management Cooperation auditing financial scandal work. He was also guilty of obstruction of justice for destroying documents related to the west management audits to hide the fraud of the West Management executive committee. Among the audit partners, Mr. Allgyer agreed to pay $50,000, Mr. Maier, $40,000, and Mr. Cercavschi, $30,000. Arthur Andersen agreed to https://www.britannica.com/topic/finance
Choose at least two of the four Arthur Andersen audit partners named in the chapter (Allgyer, Maier, Cercavschi, and Kutsenda) and research what happened to them as a result of the Waste Management audit. Summarize what happened to each partner (include links to your articles). Do you think these consequences were appropriate?
Allgyer was an allied partner with the Anderson accounting firms in related to service as marketing directors, coordinating the selling consulting service and receiving composition service payment according to the SEC investigation reports, But the auditing report was not the correct accounting statement of the west management, and they make accounting fraud on the cooperation. Finally, the SEC has taken the measurement and investigated their fraud. Allgyer agreed to pay a civil money penalty of $50, 000 and suspended any public accounting service for limited years.
Edward Maier was another accounting firm partner of Arthur Andersen. He was the risk management partner for the Anderson accounting firm, but they did not agree to adjust the problem after the SEC Investigated the accounting fraud of West management. Based on the agreement, Maier agreed to pay a civil money penalty of $40,000 and was suspended from any public auditing service for a limited year. https://www.sec.gov/news/headlines/andersenfraud.htm
What policies or procedures (internal controls) could Waste Management have used to avoid fraud?
There are different types of procedures in the accounting financial statement investigation and registration. Internal control is a significant factor to protect the financial fraud in one organization, and then GAAP is specific rules for accounting for transactions occurring in a business enterprise. The internal control has to follow the procedure of sufficient information, review of the processing of sales and purchasing invoice checking, checking and evaluation of the merchandise processing costs, and checking the processing of cash receipt documents, and respect. And follow the AICPA the professional ethical code of accounting.
What policies or audit procedures could Arthur Andersen have used to avoid the problems in the Waste Management audit?
There are different accounting principles, rule and then Anderson has to follow based on the accounting procedure investigation to find out the faults and then follow the standard rule and regulations, follow the accounting principle of AICPA, and quality and better professional employees on the operation, and another accounting rule including GAAS, GAAP, and other regulations.
How did this case affect your views and opinions about Waste Management?
Did you know about the company before this chapter? Would you do business with them? I think we have gotten a lesson and information on financial fraud making by some auditing firms and organizations. This cooperation accounting scandal would be a financial crime and hurts one country’s economy and mess up fraud maker family life because whatever we doing fraud, the fraud maker would get their price from justice that was based on investigation and come up with the truth, therefore the case is given a lesson to us. We have to work the right way of business operation based on the accounting rule and regulations. I did not know this fraud company and I did not do such type of business with a fraud business group.
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