This article uses three recent cases, zzzz best, regina, and lincoln savings & loan, to highlight some of the issues that accountants must be aware of when dealing with clients the red flags common to these three companies are identified to suggest important early warning signals for auditors lessons to be learned. Zzzz best case 19 in: business and management submitted by bmiester words 587 pages 3 1 ernst & whinney never issued an audit opinion on financial statements of zzzz in summary information that a successor should obtain include but not limited to information that might bear on the integrity of management. Domanick, a writer for los angeles magazine, has researched and written an intriguing and readable account of barry minkow and the investment scam he ran with his carpet cleaning company, zzzz best the case received wide coverage in 1987 and 1988 in the wall street journal and weekly business and news. The 1987 zzzz best carpeting fraud case involved barry minkow and his two business associates at the age of 16, barry minkow initiated the zzzz best carpeting cleaning business at his parent's garage (lieberman) according to investigation report evidence, the company did not make profit and mainly.
At just 16, minkow founded zzzz best carpet cleaning over the next several years, he franchised the chain and took it public and at 22, he was convicted of 57 counts of fraud and headed to federal prison where he spent nearly seven and a half years minkow's harrowing tale is hardly an isolated case each year, the total.
A company owned by barry minkow in the 1980s through such means as forgery and theft, minkow appeared to be building a multimillion dollar corporation zzzz best went public in december of 1986, eventually reaching a market capitalization of over us$200 million. Barry jay minkow (born march 22, 1966) is a former american businessman, pastor, and convicted felon while still in high school, he founded zzzz best ( pronounced zee best), which appeared to be an immensely successful carpet- cleaning and restoration company however, it was actually a front to attract investment.
This is from don ray's resume tape it's from 1988 los angeles police had incorrectly announced that whiz kid barry minkow and his zzzz best carpet cleaning company were part of the biggest cocaine operation in california history most of the news media bought the bs story the lead investigator, it.
Unfortunately, minkow didn't stop with zzzz best according to this wikipediaorg page on barry minkow, after he was released from prison for his zzzz best conviction, he perpetrated and was convicted of two additional crimes that will keep him in prison for a combined period longer than his zzzz best.
Join jim stice and earl kay stice for an in-depth discussion in this video, story of zzzz best, part of running a profitable business: revenue recognition.
Studying such cases is to help students more fully appreciate the importance and relevance of one or more particular crazy eddie, enron, phar-mor, tyco, world-com, and zzzz best a later section provides overview: madoff told investors that he chose the firm of friehling & horowitz to audit madoff securities. Free essay: zzzz best company fraud case study 1) at an early age, barry minkow was introduced to the carpet cleaning industry by his mother who worked part. In 1982, at age 16, he started zzzz best, a carpet-cleaning company, from his parents' garage in reseda, calif, in the san fernando valley “this is a drug case,” minkow says “that's all it is patrick leahy invited him to testify before a us senate subcommittee studying elder fraud but that year.