Read the following text and do the vocabulary exercises below:
It’s not unusual these days to hear about large
corporations that have become involved in some major financial scandal.
Parmalat, Enron and Worldcom are three examples of corporate irregularity.
Some companies simply don’t record their losses, or they record
them as loans to subsidiary companies that have been
specially created for that purpose . Some companies record normal
expenses as capital
expenses, and remove them from the profit-and-loss account. In some
cases, important movements of revenue are simply not recorded at
all. They mysteriously disappear from the balance sheets.
Other accounting discrepancies may include suspiciously low interest
payments, company investments that don’t exist, falsifying sales figures
and removing money from the pension or social security funds of
company workers. Corporate theft often involves billions of Euros. Many
financial analysts agree that these cases are not “mistakes”, but illegal
practices that have been going on for years.
Parmalat executives have admitted that they secretly stole at least 500
million euros ($630 million) and transferred it to a family-owned
subsidiary. The financial director admitted “cut and paste” forgery,
in which a document with Bank of America letterhead was scanned and then
added to a document verifying a deposit account with that bank holding
over $4.98 billion. The document was then passed through a fax machine
several times in order to appear authentic.
huge energy multinational corporation Enron is another example of bad
business practice. Enron admitted to exaggerating earnings and hiding
debt using a complex system. The company later went bankrupt,
and hundreds of people lost their jobs.
WorldCom, like Enron, was another very successful company. They have now
admitted that $3.8 billion of operating costs were treated as
capital spending, forcing it to restate results for 2001 and the first
quarter of 2002. With so many losses, Worldcom had to file for
bankruptcy and default on its debt of $35 billion.
Corporate theft has become an unfortunate stain on international finance.
Maybe it’s time for companies to resist financial pressure and consider
the consequences to their shareholders and employees before they act
Read the text again and find words and expressions for the following
definitions. Follow the example.
to owe = deber, estar en deuda
forgery = falsificación
stain = mancha
Listen and repeat.
Match the verbs and nouns. Use the text to help you.
Listen and repeat.
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