WorldCom inflated its profit to the extent of $US 4 billion by booking repair expenses as capital improvements. This had the impact of understating expenses and inflating their assets. Double entry at its best.
Xerox reclassified $US 6.4 billion income from equipment rental, service contracts and consumables to show in their books as revenue from sale of equipment. This piece of creative accounting to boost profits earned a $US 10 million fine.
Those practices go unchallenged because of a lack of basic commercial / financial literacy and bankrupt corporate values.
It is estimated that less than 8% of the workforce has any idea of the significance of June 30th.
In an effort to expand our Competitive edge we are demanding that employees make sound Commercial decisions without a clue about how their organisations actually spend and make money.
We don't need an army of amateur accountants but what we do need is employees to at least understand:
Organisations such as Fosters, Queensland Rail and BOC are starting to appreciate the productivity impact gained by employees knowing how their business really works. Imagine the power of an organisation of business minded people.
So go on, celebrate June 30th it's reconciliation time.
If you are interested in more information please give us a call on +61 412 026 909 and ask to speak to one of our consultants.
PARTNERS in PROGRESS