This is from a case Called
Waste Management, Inc
Manipulating Accounting Estimates
and here is the required questions
REQUIRED
[1] Review Waste Management’s ConsolidatedBalance Sheet as of December 31, 1996. Identify accounts whosebalances were likely based on significant management estimationtechniques. Describe the reasons why estimates were required foreach of the accounts identified.
[4] The Waste Management fraud primarilycentered on inappropriate estimates of salvage values and usefullives for property and equipment. Describe techniques Andersenauditors could have used to assess the reasonableness of thoseestimates used to create Waste Management’s financialstatements.
[6] Several of the Waste Management accountingpersonnel were formerly employed by the company’s auditor, ArthurAndersen. What are the risks associated with allowing formerauditors to work for a client in key accounting positions? ResearchSection 206 of the Sarbanes?Oxley Act of 2002 and provide a briefsummary of the restrictions related to the ability of a publiccompany to hire accounting personnel who were formerly employed bythe company’s audit firm.
