Groupon case analysis

Since I wrote my big post on Grouponomics in May, the optics surrounding Groupon have changed considerably. Could the fastest growing company in history sputter out just as quickly? At this point, the better question may be:

Groupon case analysis

Case Groupon The Groupon case was first discussed in Chapter 3. Here, we expand on the discu Here, we expand on the discussion of internal Groupon case analysis and the risk of material misstatement in the financial statements.

Groupon is a deal-of-the-day recommendation service for consumers. Launched inGroupon—a fusion of the words group and coupon —combines social media with collective buying clout to offer daily deals on products, services, and cultural events in local markets.

Promotions are activated only after a certain number of people in a given city sign up. Groupon pioneered the use of digital coupons in a way that created an explosive new market for local business.

Paper coupon use had been declining for years.

Groupon case analysis

But when Groupon made it possible for online individuals to obtain deep discounts on products in local stores using e-mailed coupons, huge numbers of people started buying. Less than five months after its IPO on March 30,Groupon announced that it had revised its financial results, an unexpected restatement that deepened losses and raised questions about its accounting practices.

Shares of Groupon had fallen by 30 percent since it went public, and the downward trend continues today. In its announcement of the restatement, Groupon explained that it had encountered problems related to certain assumptions and forecasts that the company used to calculate its results. In particular, the company said that it underestimated customer refunds for higher-priced offers such as laser eye surgery.

Groupon collects more revenue on such deals, but it also carries a higher rate of refunds. The company honors customer refunds for the life of its coupons so that these payments can affect its financials at various times.

Groundouts refunds within 60 days from revenue; after that, the company has to take an additional accounting charge related to the payments. Because it had been selling those deals at higher prices—which leads to a higher rate of returns—it needed to set aside larger amounts to account for refunds, something it had not been doing.

The future of Groupon’s business model

The financial problems escalated after Groupon released its third-quarter earnings report, marking its first full-year cycle of earnings reports since its IPO. While the net operating results showed improvement year-to-year, the company still showed a net loss for the quarter.

Moreover, while its revenue had been increasing in fiscalits operating profit had declined over 60 percent. This meant that its operating expenses were growing faster than its revenues, a sign that trouble might be lurking in the background. More important, the internal control problems raised questions about the management of the company and its corporate governance.

But Groupable EY for the admission of the internal control failure to spot the material weakness. In a related issue, on April 3,a shareholder lawsuit was brought against Groupon accusing the company of misleading investors about its financial prospects in its IPO and concealing weak internal controls.

According to the complaint, the company overstated revenue, issued materially false and misleading financial results, and concealed the fact that its business was not growing as fast and was not nearly as resistant to competition as it had suggested.

The red flags had been waving even before the company went public in The company seems to have concluded that the internal control shortcoming was serious enough to treat as an overall deficiency in disclosure controls rather than pointing it out in its report on internal controls that is required under Section In fact, the firm signed clean audit opinions for four years.

Should it comment on any other information? The firm did render unmodified opinions for four years. Do you believe it is possible that an audit firm can render an unmodified opinion and have no responsibility for detecting and reporting a financial fraud?

Groupon case analysis

Explain in general and specifically with reference to the fraud at Groupon. Other risks inherent to social media include information leaks, reputational damage to brand, noncompliance with regulatory requirements, third-party, and governance risks.

Please i want plagrism free answer Dec 15 Groupon Case Analysis Essay Words Mar 28th, 4 Pages In today’s boom or bust economy and the fast growing technology, the rapid growth of the online market is no surprise. Introduction Group Dynamics The study of group dynamics is strongly influenced by the field of social psychology.

Social psychologists try to understand human behavior in its broader social context, in contrast to most subfields of psychology which focus on the individual. Groupon Case Solution,Groupon Case Analysis, Groupon Case Study Solution, Groupon Case Solution Introduction: Groupon is one of the fastest growing technology companies, which has successfully expanded in 44 countries and ma.

An Appraisal Of Groupon E-Business Model Odeniyi, O. Ayodeji, Lawal, N. Tunde, Kareem, A. E. Adebowale This section focuses on the SLEPTEC Analysis of Groupon business model. This section examines the Groupon business INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 4, ISSUE 01, .

Groupon Case Study: Groupon is the commercial website which offers deal-of-the-day discounts or coupons for various goods and services of the companies which place their offers in its database.

Groupon was founded in and the website became extremely popular at once, because it enables people have a drink at a restaurant, go climbing, try yoga or dancing courses and try horse riding for.

Nov 23,  · In this case, support would be being tested, so a buy signal would exist. GRPN - (Short) Resistance Plan The technical summary data is suggesting a short of GRPN as it gets near with a downside target of

Free Case Study on Groupon |