Unraveling the Details of 10 High-Profile Accounting Scandals written by: ciel s cantoria • edited by: Linda Richter • updated: 12/30/2010 Before digging into the dirty details of each of these major accounting scandals, we’ll take a look at some of the tools that were used to first detect them – including sophisticated accounting systems and advancements in high-tech communication. Technology Fighting Against White Collar Fraud Looking back at the 10 major accounting scandals that changed the business
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twenty first century, and in the wake of the terrorist attacks of 9/11, the business world was rocked with news of financial and accounting scandals at major Fortune 500 companies. Enron, a Texas based energy company, lied about profits and was accused of concealing debts so they did not show up in the company’s accounts (BBC News, 8/22/2002). Arthur Andersen, an accounting giant, member of the “Big Six”, and Enron’s corporate auditor, collapsed completely after being found guilty of deliberately destroying
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Running Head: Is Ethics The Main Reason For Accounting Scandals? Is Ethics The Most Important Reason Behind Years of Accounting Scandals? Joshua A. Williams DeVry University Is Ethics The Main Reason For Accounting Scandals? Ethics: Is It The Most Important Reason Behind Years of Accounting Scandals? Ethics is a term that refers to a code or moral system that provides criteria for evaluating right and wrong (Spiceland, Spe, Tomassini, 2007). An ethical dilemma is a situation in which
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extent destabilized the economy. Audits, which were conducted to assess the validity and reliability of a company’s financial statements, were not detecting the material misstatements in the statements. As a result, both the US Government and the accounting profession needed to come up with a way to prevent these immense frauds from occurring in the future. As a response to these large frauds, in 2002, the US Government passed the Sarbanes – Oxley Act of 2002 (SOX) and the American Institute of Certified
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SEMESTER 2014/2015 (A141) COURSE CODE : BKAL3063 COURSE : INTEGRATED CASE STUDY PRE-REQUISITE : BKAF3073 FINANCIAL ACCOUNTING & REPORTING IV 1. SYNOPSIS This is a capstone course for the accountancy programs, which integrates knowledge from financial accounting & reporting, management accounting, taxation, audit, finance, management and business–related, information technology and other social sciences courses. Experiential exercises
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The Sarbanes-Oxley Act of 2002 The Sarbanes-Oxley Act of 2002 The Act & Impact ACC 410, Jackie Lewis, Ph.D. Abstract The Sarbanes-Oxley Act, officially named the “Public Company Accounting Reform and Investor Protection Act of 2002”, is recognized to be the most noteworthy U.S. federal disclosure and corporate governance legislation since the Securities Act of1933 (the Securities Act) and the Securities Exchange Act of 1934 (the Exchange Act). Furthermore, the provisions of the Act are
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were used for off-balance sheet financing, even though it failed to meet the required outsider 3% equity risk (Viktoriaovoian 2011). For instance, in 2001, AA auditors advised Enron that it could use a favourable accounting method for its SPEs. This was in contravened to the accounting methodology of AA’s Professional Standards Group (Fraud Law Resources for Oregon and Washington n.d., Fighting Financial Fraud section). 4. Prime Motivation of Arthur Andersen (AA) and Its Audit Partners The
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Inwon, J. (2011, May/June). Sarbanes-Oxley Act: Was the ’one-size-fits-all’ approach justified? Journal of Corporate Accounting & Finance (Wiley), 22(4), 65-76. http://dx.doi.org/10.1002/jcaf.20691 ARTICLE SYNOPSIS The article discusses whether the Sarbanes-Oxley Act and the subsequence laws were the correct solution for the problems that arose from the Enron and WorldCom bankruptcies. The article illustrates how the different rules and legislature affect different size business, and the
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Worldcom 1.What are the pressures that lead executives and managers to “cook the books ” * Pressures from investors ……they want to see that the company/business is growing * Attract new investors ….for the business to grow * Personal reasons …greed and wanting more * Pressure form the big boss * Brand of the company … the business has been known to be a big brang * Slow/decline in the industry 1. What is the boundary between earning management and fraudulent reporting
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Accounting fraud is something that seemed to spark roughly in the 2000s. A few examples of accounting fraud would be Enron, Tyco, and WorldCom. In 2002 the US congress passed an act called The Sabranes-Oxley Act. This act was passed to protect a company’s investors from the possibility of fraudulent accounting activities by corporations. There are two basic portions of the act, Section 302 and 404. Section 302 basically states that senior managers have to certify the accuracy of the accounts
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