Starting at 11 10 AM Where do we

Starting at 11: 10 AM Where do we go from here! Starting Ariel, George and Ken - Information in “Get Rich Quick!” was based in part on the New York Times article, Flavors of Fraud, by Paul Krugman – used with permission from IIA.

Get Rich Quick! With Your Own Ice Cream Business Ask about stock options

Ethyl Enron’s Ice Cream Emporium • Sign contracts to provide an ice cream cone a day for 30 years. • Underestimate costs - a lot. • Book all projected profits on future sales You are very profitable! Sell stock.

Dynegy’s Double Dip Delights • Ice cream isn’t profitable – so convince investors it will be • Buy - and sell - 100 cones/day from & to a friend (don’t bother with delivery…) Sales volume shows you will be a big player in the ice cream industry – Issue stock now!

World. Com’s 31 Flavors • Pretend that operating expenses - chocolate and vanilla - are part of the purchase price of a new refrigerator. Without short-term expenses, you look profitable – Your stock goes up!

Im. Clone’s Ice Cream Cones Bad vanilla? • Quick! Sell your stock. • Next, tell friends to sell. • Eventually, tell others.

Auntie Adelphia’s Cones and Shakes • Get investors to focus on volume of contracts rather than profits. • Invent imaginary customers. (You don’t even need sales!) Analysts say your stock is a buy!

Tyco’s Tasty Treats We’ll pretend to deliver the ice cream to Alaska. You’re “out of state” - No sales tax!

The New Math Dick has 1 scoop. Jane has 1 scoop. How many scoops do Dick and Jane have?

Starting at 11: 10 AM Where do we go from here! Starting Ariel, George and Ken - Information in “Get Rich Quick!” was based in part on the New York Times article, Flavors of Fraud, by Paul Krugman – used with permission from IIA.

The New Math 1. Count vanilla cones. 2. While auditors count chocolate, move vanilla and re-label. 3. Count “French Vanilla” cones. 4. Repeat.

“Gee, Dad – Can I Get Rich with Ice Cream Too? ” Sure, Johnny – • How about a big corporate loan? • We’ll create a special purpose entity! • With ice cream options, we can benefit from inflated prices!

Journal of Accountancy – “In today’s complex business environments, conducting a complete audit by surprise would be a practical impossibility. In CPA’s natural zeal to serve their clients and cause them minimal disruptions, they’ve gradually gotten away from unannounced audit work. ”

“all change is preceded by crisis…” Kierkegaard

The Crisis… Five of the seven largest bankruptcies in history followed annual reports with clean audit opinions. Source: Bloomberg

“Cooper told the audit committee of World. Com's board that the company had been playing dirty with its accounting practices. ” - Time Magazine Cynthia Cooper, Coleen Rowley and Sherron Watkins

CRISIS! Dangerous Opportunity