Who killed Barings Bank DOCX

Title	Who killed Barings Bank
Author	Lily Geller
Pages	2
File Size	18 KB
File Type	DOCX
Total Downloads	335
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Group 4 ABM 11-2 S.Y. 2016-2017 Who killed Barings Bank? 1. List actions that Nick Leeson took that led to the demise of Barings. When should alarms have triggered control activity at Barings' London headquarters? What may have interfered with the process? a. Nick Leeson gambled on the future direction of the Japanese market Cross trading Leeson lied about customer accounts and the normal part of futures trading He put long future positions on OSE He did not properly arbitrage He continued to bet on the Nikkei index hoping it would rise but it continues to fall causing him to lose $1.39 billion Established a bogus account (8888) b. Alarms should've triggered when the Japan's Nikkei Index futures fell down (Kobe earthquake) because it was the cost of most of the loss. c. The top officers and other accountants/auditors tried to conceal Leeson's dealings and played down their significance. 2. How were symptoms of problems at BFS hidden? Were some symptoms readily apparent? Explain. How might Barings' organizational goals have conflicted with control activities and corrective action at BFS? a. Nick Leeson was able to hide the symptoms of the problems in Barings Futures in Singapore because he was appointed as BFS's general manager and was able to supervise and hide it. b. No, not really because Leeson was able to open special accounts to conceal his unauthorized tradings. c. The Barings' organizational goals might have conflicted with control activities and corrective action in BFS because of Nick Leeson. By Leeson's power and ability as the general manager to control both of the transactions between Barings London and BFS the officials trusted him so they turned a blind eye and concealed the malicious acts of Leeson. 3. In which areas of control-precontrol, concurrent control, and/or feedback control-was Barings remiss? Explain. a. In giving the power to Nick Leeson controlling both the London Barings and BFS, they have overlooked his ability and downplayed his hidden motives in the company. 4. Describe Leeson's power at BFS. How did the power he accumulated play a role in circumventing control?...