Part of this International Financial Accounting core course deals with :
- Creative accounting and fraud : definition and difference between creative accounting and fraud. Study of fraud and ethics cases in accounting : Enron, Worldcom, Parmalat, Maxwell communications...We spent most of the time on Enron’s case and show the DVD : Enron, the film from “the smartest guys in the room”. Then it is discussed in class. Students also work on creative accounting exercise and are asked whether they would be inclined to do it.
- Sarbanes –Oxley Act of 2002 (SOX) : overview of the most important elements.
+other regulations or laws : Loi sur la Sécurité Financière in France (2003), Perben Law II on money laundering, market abuse EEC directives... leading to emphasis on Internal Business Controls (right after the big accounting scandals)
- Internal Business controls: History, definition and objectives, components. Study of the 5 necessary components for effective internal controls :
Control environment
Risk assessment
Control activities
Information & communication
Monitoring
Each component is explained, illustrated and discussed with the students with personal input from a former financial audit manager.
