Ian McIsaac

Financial Training and Consultancy
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

CORPORATE CALAMITY QUIZ

There have some spectacular corporate failures over the last few years. A feature of the recent credit cycle has been the number of previously well-regarded companies which have gone into bankruptcy or whose creditworthiness has been badly impaired.

It is rare that we can identify one reason for a company’s failure. Usually a number of factors come together to contribute to an organisation’s downfall. Please bear this in mind when doing the quiz below.

The table lists ten companies or organisations which have all suffered a reversal of fortune over the past few years. Try and match up an event in the right-hand column with a company/organisation in the left-hand column. These events have either contributed to or been associated with the setback at the relevant company/organisation. See below for answers and links to the full stories.

 
  ABB (Asea Brown Boveri)
Introduction of new £15 million reservation system which led to mis-pricing of service provided by company
  My Travel (formerly Airtours) Huge number of pallets go missing
  Enron Rogue trader incurring foreign exchange losses of $692 million
  WorldCom

Lawsuit threat following train crash

  Parmalat Legal claims over asbestos
  Jarvis

Promise of guaranteed returns in belief that interest rates would never fall to today’s level
  Royal Mint $3.8 billion of expenses improperly recorded as capital investments
  Brambles Safe left unlocked in the Gold Store
  Allied Irish Bank The company and its auditors involved in shredding key documents
  Equitable Life Setting up of offshore company called Buconero (Black Hole) used to make inter-company loans

 


 

For full stories visit:

ABB: http://news.bbc.co.uk/1/hi/business/1763450.stm

My Travel: http://www.theregister.co.uk/content/53/34517.html

Enron: Thttp://www.ex.ac.uk/%7ERDavies/arian/scandals/classic.html#enron

WorldCom: http://www.guardian.co.uk/worldcom/story/0,12167,746453,00.html

Paramalat: Shttp://money.cnn.com/2003/12/19/commentary/streetlife/streetlife_mclean/

Jarvis: http://www.guardian.co.uk/pottersbar/story/0,11994,966822,00.html

Royal Mint: http://news.bbc.co.uk/1/hi/uk_politics/2953345.stm

Brambles:http://www.guardian.co.uk/business/story/0,3604,1049857,00.html

Allied Irish: http://www.ex.ac.uk/%7ERDavies/arian/scandals/classic.html

Equitable Life: http://news.bbc.co.uk/1/hi/business/1786675.stm

 


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