Abstract This paper discusses the role and function of the Public Company Accounting Oversight Board (PCAOB) and Auditing Standard 5 (AS 5). Due to the increased demand for oversight in auditing standards, this paper also examines the impact of Sarbanes-Oxley (SOX) and the reasons for the creation of the PCAOB, as well as the implementation of the rules and regulations. Additionally, this paper examines the impact of AS 5. Keywords: audit, AS 5, financial statements, PCAOB, SEC, SOX Table
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Within the last ten years corporate scandals such as Enron, WorldCom, Tyco, etc., triggered Congress to pass the Sarbanes-Oxley Act of 2002 (Ross, Westerfield, & Jaffe, 2010). False reporting of financial transactions was the number one commonality in all the scandals. In every case, shareholders of the companies suffered hefty losses due to the misrepresentation of the transactions. Almost $11 billion was lost by the shareholders of Enron (Blackburn, 2002). WorldCom shareholders lost about $194
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public accounting firms. It is named after sponsors U.S. Senator Paul Sarbanes (D-MD) and U.S. Representative Michael G. Oxley (R-OH). The bill was enacted as a reaction to a number of major corporate and accounting scandals including those affecting Enron, Tyco International, Adelphia, Peregrine Systems and WorldCom. These scandals, which cost investors billions of dollars when the share prices of affected companies collapsed, shook public confidence in the nation's securities markets. The Sarbanes-Oxley
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accountants, and many other entities. Many argue that this was done without due consideration to the Act's possibly adverse effects. The Sarbanes-Oxley Act of 2002 was introduced following a number of court cases of fraud and mismanaging of financial statements by major corporations (e.g., Enron and others). It was deemed necessary because it was quite obvious from the growing number of corporate scandals and resultant public outrage that the corporate world needed more oversight as more and more questionable
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the intention of deceiving the employer or gaining an advantage over others is considered negligence. Negligence has five legal elements: duty, breach, cause in fact, proximate case, and damages (Kranacher, Riley & Wells, 2011, p. 61). All elements need to be present for negligence to be considered. In 2001, Enron became the center of one of the biggest fraud scandals of the decade. The executive officers Kenneth Lay, Andrew Fasto, Jeffrey Skilling including the accounting firm Arthur Andersen
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Effect of Unethical Behavior Article Analysis Effect of Unethical Behavior Article Analysis Many occupations have the potential for unethical behavior in the workplace. The accounting profession specifically can have an enormous impact on an organization. In many cases this impact can affect other companies and even the general public. Unethical behaviors in the accounting industry are often difficult to detect. Some of the more common items include understating or not reporting liabilities
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Terry Pancake November 11, 2013 Ethics Reflection Current course readings emphasized the importance of ethical behavior by companies. The word “ethical” has gained more power in the last decade because of foul practices from companies such as Enron, Arthur Anderson, and WorldCom. The unethical behavior of company executives has caused in-depth company reviews by stakeholders no matter the size or reputation of the company. This paper concisely analyzes the important role of ethics and social
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NORTHCENTRAL UNIVERSITY ASSIGNMENT COVER SHEET Learner: Anderson, Leona M. MGT7019 | Dr. Jennifer Scott | | | Ethics in Business | Case Study: A primer on Sarbanes- Oxley | <Add Learner comments here> ------------------------------------------------- ------------------------------------------------- Faculty Use Only ------------------------------------------------- <Faculty comments here> ------------------------------------------------- -------------------------------------------------
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Director Notes From Enron To Lehman Brothers Lessons for Boards From Recent Corporate Governance Failures by Frederick D. Lipman In order for boards to fulfill their oversight obligations, the organizations they serve must have robust whistleblower and compliance policies and programs to encourage reporting that can help identify risk exposures, fraud, or other illegal activity. This report identifies common pitfalls in many current whistleblower and compliance programs, and it offers recommendations
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and discuss leasing, off-balance sheet financing, and synthetic leases, and will review finance terms important in this case. Prepare any questions you may need answered to complete your analysis for that class. Exhibits 1, 2, 3, 5, and 7 are available in an Excel spreadsheet on the website (if you downloaded the spreadsheet before 8:00pm Friday, I added Exhibit 7 then). This case concerns financing large investments in capital assets in a short period of time for strategic reasons. According to
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