Describe the auditor’s responsibility for detecting this fraud.

Project: This course’s project is a combination of some of the “Internet Assignments” at the end of each chapter.

Using Microsoft Word, write a 1,000 word paper (12 pt font, double- spaced) that addresses the following requirements:

1. Fraud: Using a data source such as the wsj.com, Factiva, or your local newspaper, find an article about a company (WORLDCOM) relating to a fraud inquiry. You can also investigate some of the accounting frauds discussed in chapter 5 in the textbook.
• For the company you select, identify the pressure that led to the fraud and the opportunity present that allowed it to be committed. Speculate on the rationalization used by the fraudster to justify the fraud.
• Describe the auditor’s responsibility for detecting this fraud.
• Identify procedures that the auditor might have used to detect this fraud.

2. Revenue and Expense Recognition, Inventory Problems: Go to the SEC website (www.sec.gov) and identify three companies cited for each of the following problems:
• One company that was cited for revenue recognition problems.
• One company that was cited for expense recognition problems.
• One company that was cited for inventory problems.
For each problem, describe it and identify the accounting principle that the company violated.

Paper should be in APA formatting. Start with a title page. Write 1,000 words of content that are informative but concise. And list “References” in proper APA style on the final page.

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