Accounting Theory and Issues
LEIGHTON HOLDINGS BRIBERY CASE
KALPANA SHAHI SHKAMPAS0113
Introduction: Leighton Holdings is Australia’s one of the most reputed organization, which is active in engineering and infrastructure, mining and resources, environmental services industries and telecommunications which is listed on the Australian Securities Exchange since 1962. This company has operations in different countries including Australia, South East Asia, New Zealand, Vietnam, China and Middle East. The main focus and activities of Leighton Holdings include market positioning, strategic direction and planning, financial management and corporate and public affairs.
Leighton Holdings is charged not publicly releasing information on bribes which was paid by former executives to secure the contracts in Iraq but Leighton Holdings think it was insufficiently definite to be disclosed and in its defence filed by Melbourne City Investments in Victoria’s Supreme Court, Leighton Holdings claimed that the information was not expected to have effect on price or value. Melbourne City Investments (MCI) alleges Leighton breached disclosure laws and they did not provide any information about Unaoil bribe before October 03, 2013 and then again in October 3, 2013, Fairfax Media revealed that the former CEO Wal King was well known about bribery but he denied about that. Leighton Holdings was Australia’s 38th largest company but after all these, stock fell by 10%, then a further 4% and had a direct impact. Many Australian companies do not pay attention to bribery and corruption risks but after the case of Leighton Holdings bribery, everyone is aware.
Utilitarianism:
Now a day, people thinks that the bribery is not an unusual concept...
... middle of paper ...
...re of alleged kickback but he strongly denied any ideas of bribery.
Bibilography: http://en.wikipedia.org/wiki/Leighton_Holdings http://www.abc.net.au/news/2013-10-03/leighton-accused-of-bribes-in-iraq/4995626 http://www.leighton.com.au/our-business/our-brands/leighton-holdings http://www.smh.com.au/national/asic-to-quiz-leighton-witnesses-over-bribery-accusations-20140401-35wgp.html http://theconversation.com/bribery-corruption-and-a-reputation-in-pieces-18900 http://www.theaustralian.com.au/business/companies/investors-overreact-as-leighton-holdings-corruption-scandal-resurfaces/story-fn91v9q3-1226732568727 http://www.mauriceblackburn.com.au/areas-of-practice/class-actions/current-class-actions/leighton-class-action.aspx http://blink.ucsd.edu/finance/accountability/admin-responsbilities/practices.html
http://www.law.unimelb.edu.au/files/dmfile/201345.pdf
Shelly Zumaya (2220 East Hennepin Avenue, Minneapolis, MN 55413) is the president and sole shareholder of Kiwi Corporation (stock basis of $400,000). Incorporated in 2003, Kiwi Corporation’s sole business has consisted of the purchase and resale of used farming equipment. In December 2011, Kiwi transferred its entire inventory (basis of $1.2 million) to Shelly in a transaction described by the parties as a sale. According to Shelly and collaborated by the minutes of the board of directors, the inventory was sold to her for the sum of $2 million, the fair market value of the inventory. The terms of the sale provided that Shelly would pay Kiwi Corporation the $2 million at some future date. This debt obligation was not evidenced by a promissory note, and to date, Shelly has made no payments (principal or interest) on the obligation. The inventory transfer was not reported on Kiwi’s 2011 tax return, either as a sale or a distribution. After the transfer of the inventory to Shelly, Kiwi Corporation had no remaining assets and ceased to conduct any business. Kiwi did not formally liquidate under state law. Upon an audit of Kiwi Corporation’s 2011 tax return, the IRS asserted that the transfer of inventory constituted a liquidation of Kiwi and, as such, that the corporation recognized a gain on the liquidating distribution in the amount of $800,000 [$2 million (fair market value) - $1.2 million (inventory basis)]. Further, because Kiwi Corporation is devoid of assets, the IRS assessed a tax due from Shelly for her gain recognized in the purported liquidating distributi...
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The email from the District Manager John West to the Customer Marketing Area Manager, Alan Clarke:
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