Kaplan University AC 504 - Unit 1 Assignment

Assignment I

Tainted Baby Powder Milk

Read the Ethics Case China’s Tainted Baby Milk Powder on pp. 39–41 of your text and answer the following questions (approximately one paragraph per answer) from p. 40: 1, 2, 3, and 5

Questions:

1. Given strong profit growth, has there been any damage to Baidu.com’s reputation?

2. What would reputational damage affect, and how could it be measured?

3. What steps could Baidu.com take to restore its reputation, and what challenges will it have to overcome?

1. In some cultures, a “culture of secrecy” or manipulation of the new s is tolerated more than others. How can this be remedied by other governments, corporations, investors, and members of the public?

Assignment II

WorldCom Situation

Read the Ethics Case WorldCom: The Final Catalyst on pp. 112–118 and answer the following questions from pp. 118: 1, 2, 3, 4, 5, and 6.

Questions:

Describe the mechanisms that WorldCom’s management used to transfer profit from other time periods to inflate the current period.

1. Why did Arthur Andersen go alone with each of these mechanisms?

2. How should WorldCom’s board of directors have prevented the manipulations that management used?

3. Bernie Ebbers was not an accountant, so he needed the cooperation of accountants to make his manipulations work. Why did WorldCom’s accountants go along?

Why would the board of directors approve giving its Chair and CEO loans of over $408 million?

1. How can a board ensure that whistleblowers will come forward to tell them about questionable activities?

Assignment III