As you know, Enron as well as many other major corporations have been in the news...

As you know, Enron as well as many other major corporations have been in the news frequently over the past several years. The issues surrounding these companies are very serious and have affected many lives. In adddition, the accounting profession has received considerable negative publicity and is receiving pressure to change their regulatory structure.

discuss this situation and its implications. pick an article regarding Enron or another company and the multiple dilemmas surrounding their predicament. In addition, touch on the implications these "scandals" have on the accounting profession.

state your issues (including the source where you heard about it

Solutions

Expert Solution

The trust and faith society has upon the number crunchers, is the foundation of how corrupt one can become. And when an accountant is corrupted, it is the loss of society at large. This trust has been since ages and it's time that this become a tested trust and not blind trust.

In light of the recent scandals that has happened in the United States as well as across the globe, people in the accounting profession have lost some respect, and they have made sure that they cannot be left unregulated. There has to be multiple tests before we can say that the financials are 100% clean and there is 0% possibility of potential frauds.

These scandals when they come out, leaves a dent on the accounting profession which becomes irreparable for the years to come. And not only that, it even leaves the economy and financial markets with a loss which only gets fulfilled after it has taken some valuable lives of those affected by it.

If you see it from accountant's angle, there are no financial statements that have not been modified or tampered with to reach the numbers which the management and the shareholders want to see. So it's essentially the pressure from the stakeholders only which force the accountant to show the numbers, no matter how decent do they look such that the potential investors can be misled and a bubble can be created. Having said that, there is and has always been a need to regulate anybody who is representative of the society, so as to protect the interest of society at large.

ekkarill92 answered 1 year ago

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