One-Tel became a massive company with a large base of customers.

To achieve and establish its position

in the market, the company applied several strategies within a short span of time. But in longer run the
company was not able to maintain its position and ultimately it collapsed. After a detailed assessment of
the company and its financial report it was identified that there were multiple factors that contributed to
an enhanced inherent assessment risk.

Firstly, it was observed that the Board of Directors declared to pay dividend and bonus to its shareholders
even though the company is suffering from huge losses of approximately $291millions.This gives rise to
the fact that the Board of Directors lacks vision and were not working in the best interest of the company.
In the financial report, too many misleading information was provided to the shareholders of the
company. Since the Board of Directors were not effectively engaged with the management there
appeared a serious lacuna and proper communication was missing that led to the current situation. Earlier
in 1999 approx. 48 flaws were observed in the financial report. This indicates that the company has not
performed to the best of its ability and needs a urgent and a major attention by the management and its
Board of Directors.

Secondly, That the company was reeling under severe cash crunch and long aging debtors which was
noticed from the financial report of the company, which proved that it was not operating efficiently and
properly. Such responsibility totally lies with the Chartered Accountant and Auditors of the company to
point out about the financial health of the company in their report and suggest corrective measures. As
the Charted Accountant of the company, it is their duties to point out such things and give proper
suggestions and guidance to take corrective measure to be addressed urgently.

Thirdly, the Management of One-Tel did not take any corrective measures urgently henceforth
aiding to the increase intrinsic risk to the company along with inefficient internal controls. This gives rise
to the fact that the Board of Directors and top management of One-Tel were not performing their duties
in the best interest of the company and are inefficient in managing at the helm of affairs. Going through
the financial statement it was observed that the Management of the company made sure that the
company had sufficient funds to run the company to the shareholders hiding the actual conditions.