Case Studies

Two short case studies are offered, both drawn from the United Kingdom over the last 10 years, to illustrate the importance of careful disclosure. The first case shows the consequence of a wrong judgment call on disclosure; the second case recounts a major fraud in which information was deliberately withheld from investors. The first case, while rather historic, is particularly valuable because it shows how easily serious errors in disclosure can be made inadvertently by well qualified and experienced executives.

Case 1—Delayed Disclosure at MyTravel plc (2002 to 2005)1

Between 1993 and 1999, Airtours plc grew at a rapid rate through acquisitions. Over this period turnover grew from £690m to £5.2bn. In November 1999, the ...

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