CM-MB19

CM-MB19
MBA-BM 2019-21: Term-VI

Corporate Misconduct

Credits	3 credits
Faculty Name	Prof. Suhas M Avabruth (15 Sessions) and Prof. Santosh Prusty (5 Sessions)
Program	BM
Academic Year and Term	2020, Term V

1. Course Description

The functioning of the companies are becoming opaque day by day. With the advent of technology we are experiencing new things and at the same time new avenues of fraud are also opening up. According to an RBI report more than 71000 crore worth of fraud was reported for the year 2018-19. Hence in order to be competitive, it is imperative to understand why the frauds are committed, what are the ways in which it is committed and how to detect them and how to protect against them. This course is designed to provide an understanding of same.

2. Student Learning Outcomes
a. Student should be able to understand the reasons for corporate misconduct
b. Student should be able to understand various ways of managing the earnings
c. Student should be able to perform data analysis for detecting financial statement frauds
3. Required textbooks and reading materials

There is no prescribed textbook for the course. All the reading materials will be provided in a spiral bound copy

4. Tentative Session Plan

Session Number	Topics/Activities	Reading/case list etc.
Understanding the corporate misconduct
1	Financial Statements and investor communication: Relevance of statements, effectiveness and reactions
2	Understanding Corporate Misconduct: Why corporate fraud occurs	Readings: Anatomy of the corporate frauds by Bahram Soltani, (2014) Journal of Business Ethics
3	Understanding Corporate Misconduct: Consequences	Case Analysis – Case will be communicate later
4	Major Financial Reporting Frauds of 21st Century: Psychological and organizational perspective	Readings: Grove, Hugh and Basilico, Elisabetta, Major Financial Reporting Frauds of the 21st Century: Corporate Governance and Risk Lessons Learned (November 30, 2011). Journal of Forensic and Investigative Accounting, Vol. 3, Issue 2, Special Issue, 2011. Available at SSRN: https://ssrn.com/abstract=2277524
5	Role of strategy, leadership and Board in corporate misconduct	Will be Communicated Later
6	Role of strategy, leadership and Board in corporate misconduct	Will be Communicated Later
Gray areas of misconduct
7	Earnings Quality	Case Analysis: NEC Corporation
8	Techniques of Financial Statement Fraud: Revenue Recognition	Case Analysis: Nortel Network Corporation
9	Techniques of Financial Statement Fraud: One-time gains and shifting of revenues and expenses	Financial Shenanigans by Howard M Schilit
Fraud
10	Accounts Payable Fraud	Case: Account Payable Fraud
11	Fraud Schemes in complex transactions	Case: Fraud Schemes in complex transactions
12	Tax Frauds	Case: Tax Frauds
13-14	Bribery, sanctions and money laundering	Will be communicated later
Detection
15	Ratios	Class exercise
16	Importance of Cashflows and Debt	Class exercise
17	Dividends
18	Detecting Fraud: Benford’s Law	Class exercise
19	Detecting Fraud: Beneish Model	Class exercise
20	Comprehensive Case analysis	AIM Corporation

5. Evaluation

Course evaluation will consist of both individual and group evaluation.

Quizzes - 20% Individual evaluation

End term - 30% Individual evaluation

Exercises - 20% Individual and group evaluation

Project - 30% Group Evaluation

6. Academic Integrity

All the policies, rules and regulations as specified in the MBA-BM, student handbook will

be applicable

Created By: Alora Kar on 11/16/2020 at 11:15 AM
Category: BM 19-21 T-VI Doctype: Document

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