Business Case: The Peregrine Systems Accounting Fraud Scandal

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Peregrine Systems Inc. The topic that will be discussed for this assignment is the Peregrine Systems accounting fraud scandal. Peregrine Systems was a software company, created in 1981, which had a good business going until the Internet boom hit, as Linda Richter stated in her article (Richter). Once the Internet became an important part of society the Peregrine Systems Inc., began to see losses in their stocks. Peregrine’s top officials tried to find a way to cut their losses and make revenue again. Peregrine began to manipulate their accounting, for seventeen straight quarters they filed incorrect financial statements. These financial statements had made up prices in order to have enough revenue to exceed expectations. With Peregrine…show more content…
They were being selfish and did not want to lose money and their company to fail. That is one way they could have seen it or the unlikely reason was the senior executives did not want to see their company fail and have all of their employees lose their jobs and become unemployed. When it comes to decisions like that with a company’s senior executives it is usually comes down to greed and selfishness. Since they took the unethical route they got punished and “eight of the senior executives were indicted on fraud” (Bigelow). The senior executives had to know what they were doing was wrong so their was no excuse for it. The Peregrine Systems Inc. Scandal affected the business community by showing how the SEC will find anything that is unethical that is going. It shows that businesses should not even chance the idea of falsifying their financial statements, because somehow they would be caught. Also the affected the general public by believing that there were a good amount of people who had stocks invested in Peregrine Systems, especially when they say the company’s stock was increasing. However once the investigation started the stocks of Peregrine plummeted and thousands of people lost a large amount of

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