Just for Feet Case study

Just for Feet

- Logo 7, later called logo athletic, sold the logo to Reebok- Shine signed audit confirmation indicating he owed 700k to customer

Just for feet:

- Improperly recognized unearned and fictitious receivables from vendors- Failed to properly account for excess inventory- Improperly recording as income the value of display booths provided by vendors- Advertising allowance from vendors – No contract

o JFF recorded anticipated allowances as receivables and offset expenses- Recorded booth income as JFF’s income- JFF had leverage over vendors cause of big orders, only Thomas Shine (Logo) signed it

NextCard

- Credit card company- Undercu t average customer acquisition costs- Were not profitable, after the dotcom bubble burst, no way to get money from debt and

equity markets.- Spent lots of money getting bad customers instead of minial amount to get good

customers- Hid the losses by refusing to provide sufficient allowances each period for expected bad

debts- Once nextcard was being scrutinized The auditing team manipulated old documents to

make it seem like their conclusion was valid-