Log in

View Full Version : Scandals


Jweav63
Sep 2, 2006, 08:03 PM
I know that Enron and WorldCom were corporation scandals and that some people lost a lot of money, but how it is directly related to accounting?

phillysteakandcheese
Sep 3, 2006, 03:31 PM
Sarbanes-Oxley... PCAOB...

It's created a new regulatory environment for auditors that helps ensure that financial reporting information is honest and accurate.

For accountants, it means a lot more work - new internal controls, more intense audits of process and procedures - all intended to validate financial information, and in turn protect investors and the public interest.

NeedKarma
Sep 3, 2006, 04:29 PM
They used creative accounting (http://en.wikipedia.org/wiki/Creative_accounting) tricks to hide losses thereby showing positive results for the shareholders and the stock price