Sheldon Cooper was a strange character, perhaps more comfortable in a niversity setting than a boardroom meeting. Starting out as an 18-year-old high hool graduate, he worked his way up from the assembly floor of Switch dustries, a manufacturer of watches and clocks. Sheldon's job was to ensure that e company's name and the product registration number were affixed to the ottom of each assembled timepiece. He took great pride in his role at Switch but earned for the day when he could assume a management position. Sheldon realized that if he wanted to be successful, he would need a college ducation, so he enrolled in a local university. After Sheldon received his bachelor's egree in accounting, he informed Switch administration and asked to be onsidered for the management training program. Shortly thereafter, a position pened in the Purchasing Department for an accounts payable clerk. Sheldon mped at the opportunity, and his ascension began. Rising through the ranks, he took on roles with increasing responsibility. heldon worked in nearly all areas of the Accounting Department, including ayroll, receivables, cash management, and financial reporting. He also had a adership role in the development and implementation of the new computer stems for inventory management and accounting. y the time Sheldon was promoted to chief executive officer (CEO), his tenure with e company exceeded 25 years. He knew virtually every detail about Switch ndustries. But his meteoric rise left him with few allies. When Sheldon walked to a room, conversation ceased. Employees scattered to avoid confrontations with m, mainly because he believed in management by intimidation. He frequently ade unreasonable demands and set unattainable goals.

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Switch Watches & Clock Fraud Case CASE REQUIREMENTS 1 One factor of the internal control environment when investigating fraud is “integrity and ethical values.” In what ways were integrity and ethical values slighted by Sheldon? Support your answer with evidence from the case study in this situation. 2 Describe the investigative techniques used by the forensic team to uncover the fraud. Evaluate the success of these techniques, and outline two additional measures that could have been undertaken. 3 The fraud at Switch is one of many major financial statement frauds that have occurred in recent years. Describe five factor that could explain why the falsifying of financial statements is occurring so frequently. 4 Apply the fraud triangle to this case. Speculate on the motivation/pressures, opportunity, and rationalization of Sheldon. 5 Evaluate and comment on the Board’s behaviour. Include in your evaluation the responsibility of the Board with regards to internal controls.

Transcribed Image Text:●●● Sheldon's entire existence and self-worth hinged on the successes and failures at Switch. He never married and routinely worked 15-hour days. The employees joked that he secretly lived at the corporate office. No matter how early they arrived or how late they left, Sheldon Cooper was there. In the few hours he was not at work, he managed to cultivate expensive hobbies and tastes. It was also important to him to demonstrate his success with flashy vehicles, homes, and artwork. He lived in the most exclusive neighbourhood in Toronto and drove a candy-apple-red Ferrari. In fact, Sheldon frequently sped off to Caesars Casino to gamble with customers. He was known as a high roller. Switch began in 1922 in a Toronto basement workshop of a Swiss immigrant, Howard Wolowitz. Howard worked full time during the day as a butcher but came home each night to tinker with his collection of clocks. Word spread regarding Howard's fascination with clocks and his skill in their repair. Eventually he had so many people requesting his services that he decided to quit his job and open Switch Watches & Clock. The choice of name was similar to a famous watch brand in Switzerland. But in the 1950s, he and his son, Stuart, decided to expand the company. They became Switch Watches & Clock Industries. To keep up with the ever-increasing demand, they built a state-of-the-art facility to assemble and package their timepieces. After Howard retired, Stuart, an energetic 28-year-old, took over the helm. Stuart was less of a craftsman than his father but had a keen sense for business. He decided to bolster the company's employee time clock business. This strategy paid off with the burgeoning industrial economy and increased focus on mechanization. Sales at Switch Industries grew to record levels. After being in the business for years, Stuart took note of an ambitious employee named Sheldon Cooper who had distinguished himself in the factory and was working toward becoming a manager. Stuart developed a mentoring relationship with Sheldon, knowing that someday, he would be the leader of Switch Industries. 2

●●●
Switch Watches & Clock Fraud Case
Sheldon Cooper was a strange character, perhaps more comfortable in a
university setting than a boardroom meeting. Starting out as an 18-year-old high
school graduate, he worked his way up from the assembly floor of Switch
Industries, a manufacturer of watches and clocks. Sheldon's job was to ensure that
the company's name and the product registration number were affixed to the
bottom of each assembled timepiece. He took great pride in his role at Switch but
yearned for the day when he could assume a management position.
Sheldon realized that if he wanted to be successful, he would need a college
education, so he enrolled in a local university. After Sheldon received his bachelor's
degree in accounting, he informed Switch administration and asked to be
considered for the management training program. Shortly thereafter, a position
opened in the Purchasing Department for an accounts payable clerk. Sheldon
jumped at the opportunity, and his ascension began.
Rising through the ranks, he took on roles with increasing responsibility.
Sheldon worked in nearly all areas of the Accounting Department, including
payroll, receivables, cash management, and financial reporting. He also had a
leadership role in the development and implementation of the new computer
systems for inventory management and accounting.
By the time Sheldon was promoted to chief executive officer (CEO), his tenure with
the company exceeded 25 years. He knew virtually every detail about Switch
Industries. But his meteoric rise left him with few allies. When Sheldon walked
into a room, conversation ceased. Employees scattered to avoid confrontations with
him, mainly because he believed in management by intimidation. He frequently
made unreasonable demands and set unattainable goals.
1

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