About the Book

Auditing Assignment

Introduction

Corporate governance, ethical practices in business and a strong financial control system are the pillars of the sustainability of any organization. Failing in any of these aspects may lead to the demise of the business. This is what happened with many fast growing organizations. The management of fast growing organizations neglects these aspects and ends up ruining the business. To cover up the loopholes, they fudge the accounting data and try to come out of the dark when it is too late. In the end, the world comes to know about the mistakes and list of accounting frauds. This is what happened with One.Tel, an Australian Telecommunication service provider. We will discuss the problems faced by the organization and the possible causes of the problems.

ONE.TEL – Downfall of a big corporate

One.Tel Limited (OTL) was incorporated in 1995 with only business of reselling the telephone services of major telecommunication service provider, Optus. The business model was simple and straight forward as it was earning a fixed amount of money by giving a customer to the service provider company. After getting its hand on the industry, OTL decided to enter into the telecommunication industry by providing all the services on its own rather than just reselling it.The beginning was good and it was riding on the super fast growth. It was proving to be a very good decision to its shareholders and general public. But, the focus was more on doing more and more business rather than on doing the business right way. It was in 2000 when the problems started and it became known to public that the big giant is going to fall. The approach was aggressive, but without due diligence (Davies and Aston, 2011). Aggressiveness is good, but it has to be within the boundaries specified by the strong analysis of the situation.

 

Disclosure of Material Connection: Some of the links in the page above are "affiliate links." This means if you click on the link and purchase the item, I will receive an affiliate commission. I am disclosing this in accordance with the Federal Trade Commission's 16 CFR, Part 255: "Guides Concerning the Use of Endorsements and Testimonials in Advertising."