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Nguyen, Huu Cuong. "Enron fiasco: Business difficulty and the role of Enron’ directors." Corporate Ownership and Control 8, no. 4 (2011): 165–68. http://dx.doi.org/10.22495/cocv8i4c1p2.
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Enron Corporation’s high-profile collapses marked a new period for dramatic changes to corporate governance worldwide that mainly focuses on law reform to prevent, or al least mitigates, similar future corporate collapse. The paper investigates Enron’s demise by addressing the two main aspects: Enron’s business and the role of Enron’s director in governing the Corporation, especially with the presence of dual role of the chairman and chief executive officer in its organisational structure
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MARIĆ, DRAŽEN, and PAVLE PARNICKI. "AUDIT ANALYSIS OF ENRON ELECTRIC POWER CORPORATION THROUGH THE PRISM OF MARKETING (NON) ETHICS." Kultura polisa, no. 45 (July 3, 2021): 335–45. http://dx.doi.org/10.51738/kpolisa2021.18.2r.5.01.
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In the scientific research work, under the above title, we dealt with the analysis of the already performed audits of the business of the American electric power corporation Enron which went bankrupt. We did a similar analysis through the prism of the already existing triangular connection on the relation: absence of moral vertical (by vocation, above all, business provenance) - greed - incompetence (we can say, unprofessionalism), ie. marketing unethics. Primarily, the emphasis was on the audit of Enron's financial and accounting reports but inevitably there was also an audit of compliance with the legal procedure, precisely during the procurement of certain resources necessary for business and finally an operational audit was performed, that is, an audit of the entire business. Using the technique of in-depth recording of the business vs. financial situation, in fact already performed audits, we tried to scan first and then to explain the correlation of neuralgic points which led to its bankruptcy. By pointing out the connections of at least harmful influences as well as their scope and intensity we try to , by using qualitative analysis, positively influence other current ones or corporations which will only enter the market scene
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Turnage, Anna. "Electronic Discourse, Agency, and Organizational Change at Enron Corporation." Western Journal of Communication 80, no. 2 (November 2, 2015): 204–19. http://dx.doi.org/10.1080/10570314.2015.1075062.
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Kusumastuti, Retno, and Azhar Kasim. "Corporate Governance in PT Lippo Karawaci Tbk." Issues In Social And Environmental Accounting 6, no. 1 (June 30, 2012): 72. http://dx.doi.org/10.22164/isea.v6i1.65.
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When mismanagement and misuse run rampant in giant corporations, as in the case of Enron in 2001, good corporate governance becomes mandatory. From the perspective of the agency theory, the separation of capital owners and management must lead to strictly applied good corporate governance. The purpose is to eliminate any disadvantages to the corporation's objective, namely providing added values to all relevant parties. The agency theory also covers two aspects: agency issues and agency costs. The research uses the qualitative approach and data is gathered through extensive interview, secondary data, and bibliography study. Key persons among the sources are selected based on specific criteria. Data validity is obtained through the triangulation technique, and the samples used are PT Lippo Karawaci Tbk and subsidiaries. The results show that governance practices are unique in each corporation, in accordance with their characteristics.
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Nguyen, Huu Cuong. "Factors causing Enron’s collapse: An investigation into corporate governance and company culture." Corporate Ownership and Control 8, no. 3 (2011): 585–93. http://dx.doi.org/10.22495/cocv8i3c6p2.
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This paper investigates and evaluates the weaknesses of Enron’s corporate governance structures, weaknesses that lead to the collapse of the company. Overall, poor corporate governance and a dishonest culture that nurtured serious conflicts of interests and unethical behaviour in Enron are identified as significant findings in this paper. Employing the case study method, the paper synthesizes, analyses, and interprets all aspects of corporate governance that lead to Enron’s collapse based on three main reports: The Powers Report (Powers, Troubh and Winokur 2002), the Testimony of Chief Investigation (Roach 2002), and The Subcommittee’s Report (United States Senate’s Permanent Subcommittee on Investigations 2002). Firstly, Enron’s Board of Directors failed to fulfil its fiduciary duties towards the corporation’s shareholders. Secondly, the top executives of Enron were greedy and acted in their own self-interest. Thirdly, many of Enron’s employees witnessed the wrongdoings of Enron’s top executives, and quite a few whistleblowers came forward. Lastly, Enron outsourced external auditing for its internal audit function instead of establishing a functionally internal audit mechanism and its external auditor acquiesced in the application of questionable accounting and fraudulent financial reporting. Although Enron’s collapse has been widely discussed in the literature, no paper has been found that synthesizes the various aspects of corporate governance that resulted in the Corporation’s collapse. This paper contributes to the literature on the numerous weaknesses of Enron’s corporate governance structures, including the following: the role of the Corporation’ board, especially its top executives; the Corporation’s corporate culture and whistle-blowing system; and the Corporation’s internal auditor and external auditors.
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Boozang, Kathleen M., and Simone Handler-Hutchinson. "“Monitoring” Corporate Corruption: DOJ's Use of Deferred Prosecution Agreements in Health Care." American Journal of Law & Medicine 35, no. 1 (March 2009): 89–124. http://dx.doi.org/10.1177/009885880903500103.
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It has become a truism to cite Enron as the new millennium’s watershed impetus for government assertion of power to improve corporate governance. While indictment of corrupt corporations and their executive leadership seems an obvious corrective to corporate norms that have gone astray, the unsuccessful prosecution and demise of Arthur Andersen proved a stunning backfire of such a blunt weapon. The public accounting industry shrunk even further, to the detriment of clients, and thousands lost their jobs. Arthur Andersen taught that an indictment itself may be sufficiently damaging to close the doors of a public corporation.
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Wirianata, Henny, and Sofyan S. Harahap. "PERSEPSI DOSEN DAN MAHASISWA AKUNTANSI TERHADAP PROFESI AKUNTAN PUBLIK PASCA ENRONSTUDI KASUS PADA LIMA PTS DI JAKARTA BARAT." Media Riset Akuntansi, Auditing dan Informasi 7, no. 3 (December 24, 2007): 367. http://dx.doi.org/10.25105/mraai.v7i3.763.
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<p class="Style1"><em>This study is a developed from DeZoort, et al (1997), Yeni (2001) and Abdullah and Selamat </em><em>(2002), The objective is to know the perception of lecturers and students on public accountant </em><em>profession post Enron scandal and to know whether there is a significant difference between them. </em><em>Data is collected from questioners given to 5 private universities in West Jakarta with 210 respon-</em><em>dents consist </em>of <em>55 full-time lecturerrespondents and 155 accounting undergraduate students who </em><em>have taken or is taking auditing subject. The study shows that not all lecturers and students know </em><em>Enron Corporation scandal. In spite of that, lecturers and students who know and do not know, </em><em>have positive perception in public accounting profession post Enron and there is no significant </em><em>difference between them. While t-test result indicates that there is a significant difference percep-</em><em>tion between lecturers' and accounting undergraduate students', especially in ethic and responsi-</em><em>bility aspects, but not in knowledge and skill aspects. The result also shows lecturers have more </em><em>positive perception than students do.</em></p><p class="Style1"><em>Key </em><strong><em>words: </em></strong><em>Enron Corporation, academics, perception, public accountant profession, accounting </em><em>lecturer, accounting student</em></p>
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Lord, Heather L. "Annual Reports: A Literature Review (1989–2001)." Journal of Technical Writing and Communication 32, no. 4 (October 2002): 367–89. http://dx.doi.org/10.2190/28lm-3hqr-r5qm-fcau.
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Since the collapse of Enron Corporation in November 2001, annual reports and corporate financial disclosures have been the focus of government, corporate, and public attention. This article examines the literature written about annual reports between 1989 and 2001 to identify trends in research and determine areas of future study. Articles were categorized as related to SEC regulations and guidelines, summary annual reports, online annual reports, rhetorical analysis of annual reports, readability and accessibility of annual reports, methods of conveying negative information in annual reports, effective annual report writing, use and importance of annual reports, or use of annual reports in business writing classes. Post-Enron, it is likely that the number of articles in this area will dramatically increase over the next five to ten years.
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Munawer, Zeyad, Sofri Yahya, and A. K. Siti-Nabiha. "Sell-side Security Analysts: Re-reporting of Enron Corporation Fraudulent Financial Data." Procedia - Social and Behavioral Sciences 62 (October 2012): 749–60. http://dx.doi.org/10.1016/j.sbspro.2012.09.127.
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Brown, Veena L., Brian E. Daugherty, and Julie S. Persellin. "Satyam Fraud: A Case Study of India's Enron." Issues in Accounting Education 29, no. 3 (February 1, 2014): 419–42. http://dx.doi.org/10.2308/iace-50735.
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ABSTRACT This case provides students a unique opportunity to examine and reflect on the challenges of auditing in today's global environment. Students examine a real-world billion dollar plus embezzlement and fraud at Satyam Corporation, an international company based in India and previously trading on the New York Stock Exchange. The case focuses on auditors' responsibilities related to obtaining and evaluating audit evidence, particularly as it relates to confirming cash and receivables. It also explores the quality control responsibilities related to audit procedures performed by foreign affiliates of a large international audit firm. The case illustrates the role of culture in performing an audit in accordance with auditing standards issued by the U.S. Public Company Accounting Oversight Board. Additionally, case details provide opportunities for class discussions and foster students' critical thinking skills on other auditing topics such as audit risk and planning, related party transactions, tone-at-the-top, and internal control deficiencies. By using a foreign issuer to explore these issues, the case highlights both the technical and international challenges of performing auditing procedures.
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Grove, Hugh, and Milan Čupić. "ICN pharmaceuticals: corporate governance analysis." Corporate Ownership and Control 7, no. 4 (2010): 73–89. http://dx.doi.org/10.22495/cocv7i4p6.
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ICN Pharmaceuticals, Inc. (today Valeant Pharmaceuticals International) was a drug developer and manufacturer, known in the medical field for its development of Ribavirin, an antiviral compound used to treat various viral infections. However, ICN will probably be remembered mostly as an example of problematic and inefficient corporate governance. Changes in the management structure of ICN occurred almost at the same time when corporations, like Enron, WorldCom, Tyco, were dealing with financial scandals caused by problems in corporate governance. Since ICN was not a powerful corporation and found a way to deal with its problems, it was not subject of any big financial scandal. Nevertheless, it is interesting how ICN managed to operate, in some years even successfully, with so many corporate governance problems and how Milan Panic managed to stay at the top of ICN for 42 years, in spite of his numerous expensive law suits, scandals and bad decisions.
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Abatecola, Gianpaolo. "Prioritizing Short-Termism in Behavioural Strategy: Lessons from Enron – 20 Years On." International Journal of Business and Management 14, no. 4 (March 8, 2019): 60. http://dx.doi.org/10.5539/ijbm.v14n4p60.
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What are the risks of prioritizing short-term goals in corporate strategy against more long-term oriented (and hopefully sustainable) corporate performance? Through a qualitative case study narrative recalling some aspects of the sadly famous, but still insightful, bankruptcy of the Enron Corporation in the US (2001), this article aims at contributing to shed light on this lively research question within the international research on and practice of behavioural strategy. Given that, also currently, the seasons of corporate scandals do not seem to have ended, the main motivation behind this work is that the lessons which we could have learned after almost 20 years since the Enron seminal disaster occurred, can still probably have a value. In parallel, the main conceptual contribution offered by our case perspective is that, while the massive past and recent Enron’s coverage has mostly devoted attention to the aspects of fraud and its associated business ethics, our analysis is, instead, focused on the corporate strategic orientation mainly deriving from the macho culture of the top executives. Of course, we are aware that concentrating on the latter cannot avoid acknowledging also the importance of the former. Furthermore, the case can also offer a methodological contribution; in fact, while much of the research in corporate governance has been implemented through quantitative techniques, scholars have also recently claimed that additional qualitative research is complementarily needed to reach a more exhaustive big picture on how executives behave.
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Vasudev, P. M. "Law, Economics, and Beyond: A Case for Retheorizing the Business Corporation." Review Essay 55, no. 4 (February 16, 2011): 911–64. http://dx.doi.org/10.7202/1000789ar.
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This essay presents a critical analysis of the economic theory of corporations and its idioms, such as “nexus of contracts”, “agency costs”, and “shareholder value”. It calls for the development of a richer and more inclusive theory of business corporations that draws on the experience of the last three decades and better addresses the needs of the post-Enron, post-AIG world. The author identifies the following shortcomings of the economic theory of corporations. First, the contractarian interpretation overlooks the role of law and public policy in corporations. Second, using share prices as the yardstick of corporate performance and encouraging practices such as the buyback of shares have serious implications for the competitiveness and sustainability of corporations. Third, there is inadequate attention to the characteristic and normative distinctions between debt and equity. And fourth, hostile takeovers are treated as virtually the only solution to entrenched managements. The problem of managerial power must be reviewed in the light of evidence regarding managerial power and the efficacy of boards. Equally, there is a case for developing a more deliberated, fair, and equitable policy on executive pay.
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Gordon, Jeffrey N. "What Enron Means for the Management and Control of the Modern Business Corporation: Some Initial Reflections." University of Chicago Law Review 69, no. 3 (2002): 1233. http://dx.doi.org/10.2307/1600646.
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HOFFMAN, W. MICHAEL, and MARK ROWE. "The Ethics Officer as Agent of the Board: Leveraging Ethical Governance Capability in the Post-Enron Corporation." Business and Society Review 112, no. 4 (December 2007): 553–72. http://dx.doi.org/10.1111/j.1467-8594.2007.00309.x.
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Tara, Sharukh, and Sorab Sadri. "Corporate Governance and Risk Management: An Indian Perspective." International Journal of Management Science and Business Administration 1, no. 9 (2015): 33–39. http://dx.doi.org/10.18775/ijmsba.1849-5664-5419.2014.19.1003.
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Companies need funds to finance their activities and as a result, there has been a need for accountability to protect the interests of those providing the funding. Companies are also managed by directors who act as agents of the shareholders. Under pressure to maximize wealth they are prone to excessive risk, reckless conduct or in extreme cases, blatant manipulation of accounting figures. The call for increased accountability grows louder every time there is a crisis in public confidence. Whether this is the stock market crash of 1929, for example, or the more recent high-profile collapses of a number of large firms such as Barings Bank, Enron Corporation and WorldCom, the resulting uncertainty has led to renewed interest in corporate governance practices. It is not only as a means of directing and controlling corporations but as a means of mitigating corporate risk. This paper bases on over a decade’s research attempts to shed some light on this topic based on the Indian experience. Paper tries to bring out the fact that there is a significant relationship between corporate governance and the management of risk and that corporate governance is one of the main means by which a company can manage risk.
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Al-Tawil, Tareq Na’el. "The major issues that need to be addressed by effective corporate governance in the 21st century." Journal of Financial Crime 23, no. 2 (May 3, 2016): 349–78. http://dx.doi.org/10.1108/jfc-01-2015-0003.
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Purpose This paper aims to underline and evaluate what corporations are as artificial entities, the concept of corporate governance (CG) in the twentieth century and whether a corporation owes allegiance to its key stakeholders in the twenty-first century. Design/methodology/approach Because it requires development in the twenty-first century, a clarification of the key areas of reform in “global corporate governance” is overdue. These include an analysis of the stakeholder role; the logic and effect of the codes of corporate practise such as in the Cadbury Code and Combined Codes. The “value chain theory” in CG and how it should be placed not only on financial value but also on natural, human and cultural values will looked at. This paper also provides a brief insight into major multi-national corporate collapse. The Enron case, for example, highlights how such mishaps can be avoided to rekindle trust and transparency, as well as disclosure to authorities, shareholders and the public. Findings This paper looks at how public interest and consumer interest play a role in corporate existence by analysing an inevitable change in the twenty-first century from absolute corporate control to public/consumer control and have an influence in areas like environmental, ethical and employee protection and recognition. The emotional side of a corporation is brought to life to win the hearts of consumers and the public. How this fares in the light of profits and long-term Environmental Management Scheme investment will be evaluated. Originality/value This paper ends with a general conclusion, summarising the necessary changes to governance and the author’s opinion on the realities of change: will it work, will it improve the living standards or will it just increase the gap between well-organised and ill-fated economies?
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Shirur, Srinivas. "Tunneling vs Agency Effect: A Case Study of Enron and Satyam." Vikalpa: The Journal for Decision Makers 36, no. 3 (July 2011): 9–20. http://dx.doi.org/10.1177/0256090920110302.
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This is a comparative study of Enron and Satyam corporate frauds. An attempt has been made to arrive at some generalizations about the key reasons for the differences between agency and tunneling problems. Agency effect and tunneling phenomena focus on the divergence in the interests of managers, promoters, and minority shareholders, which are the key reasons for corporate fraud. There is a clear difference between the fraud committed due to tunneling and agency effect. The article highlights this feature through the case study of Enron and Satyam. The difference between tunneling and agency effect has important implications for corporate finance. Corporate finance is based on the assumptions of separation of ownership and management and also perpectual continuity of corporation. If these two assumptions are dropped, then many of the widely accepted theories may not hold. The article concludes that the legal framework, nature of financial system, and level of economic development are the key factors which determine the level of agency effect and tunneling problem. Solutions to corporate governance problems are quite different in India as compared to the US or Europe. Hence, it would be inappropriate to copy American legislations like Sarbanes Oxley Act in India. Effective prevention of destructive self-dealing activities is necessary for development of vibrant capital market, whereby small investors will be confident to invest in the Indian market, since they will perceive risk premium to be low. The key policy prescriptions are as follows: Effective delivery of justice is as important as enacting investor-friendly laws. Creation of subsidiary companies by the parent company and large financial transactions with banks should be viewed with suspicion. On the part of the shareholders, they should be suspicious of any self-dealing transactions. Since the time of Harshad Mehta, when stock brokers, promoters of the company, and bankers connived to cheat small investors, enforcement agencies view even large banking transactions with suspicion. Small investors and institutional investors should play a proactive role to seek information and reject any decisions which reduce their value of shares. Proactive participation of outside shareholders in the corporate affairs of the company, especially in the selection of board of directors and approval of resolutions, are the key remedies to prevent such cases. There should be an effective control of black money. Certain clues like promoters setting up too many subsidiaries, frequent changes and resignations in board of directors, consistent decrease in promoter stake or increasing liquidation of equity options, are clear signs of fraud taking place. Regulatory authorities should work on such clues and operate in such a way that there is least chance of regulatory arbitrage.
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Benke, Gavin. "Electronic Bits and Ten Gallon Hats." Enterprise & Society 14, no. 4 (December 2013): 705–16. http://dx.doi.org/10.1093/es/kht077.
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My dissertation uses the Enron Corporation to examine how companies use culture to shape political and economic systems. Throughout the 1980s and 1990s, the company morphed from a vertically integrated natural company into a derivatives trading house. An emphasis on innovation, free markets and knowledge work in the firm’s marketing efforts accompanied this organizational shift. Because the change was so dramatic, after its 2001 collapse the company became an ideal site for Americans to express cultural anxieties about the move away from Fordist production and toward an emphasis on working with complicated pieces of information. Drawing on archival sources such as issues of the employee magazine and executive correspondence, this study contributes to an understanding of the cultural work that must be performed in order to establish and maintain political economic systems, as well as the ways in which cultural production is used to make sense of economic change.
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Teck, Tan Seng, Selvamalar Ayadurai, William Chua, Tan Peng Liang, and Shahryar Sorooshian. "Sensemaking Corporate Social Responsibility, Reflexive Organisational Change and Moral Transpose, the Case of Volkswagen ‘Diesel Dupe’ Crisis." Journal of Management and Sustainability 10, no. 1 (February 7, 2020): 66. http://dx.doi.org/10.5539/jms.v10n1p66.
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The world has witnessed corporate scandals of monstrosity magnitude. The Enron Scandal, the Nike Sweatshop scandal and the recent Johnson and Johnson baby talc in 2018 are some dishonors that reshaped the business world and reinvigorated the importance of business ethics. Indeed, supranational and national movements such as the Global Reporting Initiatives have responded to these scandals by imposing stricter corporate reporting to instill greater transparency and corporate responsibility. Ironically, despite unwavering efforts, corporations are still blatantly flouting regulations. The Volkswagen “diesel dupe” crisis is a stark reminder of the inherent weakness of current regulations. Despite Volkswagen’s staunch adherence to those stringent reporting guidelines, they breached ethics to the core, creating a tsunami of vehicle recalls, massive social, political and legal repercussions. Volkswagen’s cheat device is a ‘creative destruction’ that challenged the fundamental usefulness of corporate reporting. Corporate social responsibility has evolved tremendously, now taking the form of positivistic reporting patterns. Corporations are measured by their ecological, social and economic performance where they flamboyantly table those data and information to garner stakeholders’ support and legitimacy. However, a pragmatic approach towards corporate social responsibility is self-defeating. It erodes and dilutes a corporation’s ability to make sense, communicate and adapt to their externalities. Instead, corporations boast of their corporate prowess and triple bottom line. Using Volkswagen as a subject, this paper exposes the inherent weaknesses of a positivistic corporate reporting approach to social responsibility. A positivistic approach such as this cannot engender a truthful, honest and open posture in business corporations. Instead, this paper exemplifies that a meaningful sensemaking corporate social responsibility instills reflexive organisation change and moral transpose within corporations. This paper underlines this reflexive organisational change and moral transpose in Volkswagen as they encounter the diesel crisis. This study is novel and greatly enhances previous literatures in corporate social responsibility by instilling an appropriate model to underline these momentous reflexive organisational changes and moral transformations in Volkswagen.
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McSweeney, Dean. "Reform in a Cold Climate: Change in US Campaign Finance Law." Government and Opposition 40, no. 4 (2005): 492–514. http://dx.doi.org/10.1111/j.1477-7053.2005.00162.x.
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AbstractThe Bipartisan Campaign Reform Act (BCRA) of 2002 was the first major change in US federal campaign finance law in a quarter of a century. Many attempts at reform had failed in that period. Few members of Congress were enthusiasts for reform, the two parties and two chambers had conflicting interests to protect, successive presidents did not promote the issue and public pressure for reform was weak. When reform was achieved in 2002, many of these formidable obstacles remained in place. This paper draws on the literature of public interest reform and policy innovation to attribute the change to a policy entrepreneur whose resources had undergone a sharp increase, the neutralization of opposition, the impact of an event (the bankruptcy of the Enron Corporation) and membership turnover in Congress. The substantial support for the bill in Congress from Democrats, the party with most to lose from reform, is attributed to the inescapability of past commitments.
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Karim Miajee, Md Rezaul. "The American National System of Corporate Governance." International Journal of Shari'ah and Corporate Governance Research 1, no. 1 (October 21, 2018): 3–21. http://dx.doi.org/10.46281/ijscgr.v1i1.56.
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Introduction Corporate governance (CG) has recently been extensively discussed, intensely debated and variously defined in the United States. For the purposes of this chapter, CG shall mean the internal arrangements within a corporation intended to provide reasonable assurances that corporate directors and officers make and implement decisions in accordance with their duties of care and loyalty to their corporations. CG in the United States is often associated with the recent initiatives taken in the wake of corporate scandals such as Enron and MCI. While the recent initiatives are undoubtedly important, their significance can best be understood in the context of the existing frameworks under corporate and securities law. The current initiatives in the United States (i.e. the recently adopted CG provisions in the listing requirements for the New York Stock Exchange (NYSE) – and the provisions of the Sarbanes–Oxley Act of 2002 – often called “Sarbanes– Oxley”) in important ways simply add to the governance measures already in place pursuant to corporate law and securities regulation in the United States. Only after understanding foundations in corporate law and securities regulation in the United States is it possible to understand the significance, and the limitations, of the recently adopted NYSE listing requirements and of Sarbanes–Oxley. In general, the recent NYSE initiatives attempt to improve the degree of independence among directors of corporations listed there so that they are better able – and more likely – to meet the performance standards currently applicable to directors under corporate law (i.e. duties of care and loyalty), but the NYSE does not change those standards. Unfortunately, the NYSE listing requirements do not have the force of law. Sarbanes–Oxley, on the other hand, in general, attempts to improve the independence of external auditors and corporate directors so that they are better able – and more likely – to prepare public disclosures in form and substance required by US securities regulations. There are also provisions intended to enhance the care with which corporate officers prepare required public disclosures. Unfortunately, Sarbanes–Oxley applies only to disclosure requirements under US securities regulations. With limited exceptions, Sarbanes–Oxley is not specifically intended to apply to directors’ or officers’ broader obligations to their corporations or the standards applicable to their performance of those obligations.
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Rodzi, Nur Amira, and Aida Hazlin Ismail. "What do You Know About Audit Quality in Malaysian Small and Medium Audit Firms?" Asia-Pacific Management Accounting Journal 16, no. 3 (December 1, 2021): 383–407. http://dx.doi.org/10.24191/apmaj.v16i3-15.
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Audit quality has been addressed and is being discussed globally, throughout the years. The Enron Corporation and WorldCom cases have affected the reputation of the audit profession. The credibility of auditors also has become more questionable as the auditors' function in identifying mistakes and fraud is being debated by the public. However, the issue of audit quality has only focused on big firms only. There is shortage of studies that focussed on audit quality in small and medium audit firms. In line with this issue, this study aimed to investigate the relationship between top management support, auditor’s experience and auditor’s accountability on audit quality amongst small-medium audit firms in Malaysia. By employing the Attribution Theory, the study utilised purposive sampling. The data used in this study was primary data obtained through questionnaires from external auditors in small and medium sized audit firms around Klang Valley. A total of 100 questionnaires were distributed and the number of usable questionnaires was 81. Findings indicate that auditor’s experience and auditor’s accountability have a significant effect on audit quality. This research thus contributes to standard setters, regulators, policymakers and other audit firms by providing evidence with regard to the determinants of audit quality judgment in Malaysian small and medium audit firms. Keywords: audit quality, small and medium audit firms, audit judgments, accountability, audit experience
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Murshed, Shahriar Tanvir Hasan, Shahadat Uddin, and Liaquat Hossain. "Transitivity, hierarchy and reciprocity of organizational communication network during crisis." International Journal of Organizational Analysis 23, no. 1 (March 9, 2015): 2–20. http://dx.doi.org/10.1108/ijoa-04-2012-0584.
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Purpose – This paper aims to explore changes in communication networks during organizational crisis. In the literature, various terms such as organizational mortality, organizational death, bankruptcy, decline, retrenchment and failure have been used to characterize different forms and facets of organizational crisis. Communication network studies have typically focussed on nodes (e.g. individuals or organizations), relationships between those nodes and subsequent affects of these relationships upon the network as a whole. Email networks in contemporary organizations are fairly representative of the underlying communication networks. Design/methodology/approach – The changing communication network structure at Enron Corporation during the crisis period (2000-2001) has been analyzed. The goal is to understand how communication patterns and structures are affected by organizational crisis. Drawing on communication network crisis and group behaviour theory, three propositions are tested: communication network becomes increasingly transitive as organizations experience crisis; communication network becomes less hierarchical as organizations are going through crisis; and communication network becomes more reciprocal as organizations are going through crisis. Findings – In this research analysis, the support of these three propositions was noticed. The results of tests and their implications are discussed in this paper. Originality/value – This study builds on an emerging stream of research area that applies social network analysis to organizational interaction data to study various questions related to organizational change and disintegration. These findings could help managers in designing an effective approach to monitor regular functionalities of their organizations.
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Abatecola, Gianpaolo, and Matteo Cristofaro. "Ingredients of Sustainable CEO Behaviour: Theory and Practice." Sustainability 11, no. 7 (April 2, 2019): 1950. http://dx.doi.org/10.3390/su11071950.
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What CEO attributes can improve corporate sustainability? In this regard, what do superstar CEOs, e.g., Mark Zuckerberg, Jeff Bezos, Elon Musk, and Bill Gates, have in common? Also, did the personalities of Jeffrey Skilling and Kenneth Lay contribute to the crack in the US Enron Corporation early in this century? Why, as far as presidential elections are concerned, are some countries, more than others, more likely to vote for seemingly narcissistic politicians? In our practice-oriented review article, we aim to contribute to shedding new light on the challenging evidence continuously evolving around CEOs, in general, and around their effect on corporate sustainability, in particular. Two distinctive features represent the main “so-what” value of our work. First, each of the CEO attributes which we sequentially focus on (i.e., power, personality, profiles, and effect) is, at the beginning, not only separately considered but also associated with many recent examples from business life and from the “CEO world” at an international level. Second, from our analysis, we then derive a conceptual framework which, combining all these attributes into a unique body of knowledge, could be used as a potential starting point for future investigations in this challenging research area regarding the CEO/sustainability relationship. In this regard, we believe understanding how all the analysed attributes coevolve will represent a pivotal question to address if we want to enhance the scientific and practical understanding of CEO (sustainable) behaviour.
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Seetharaman, Arumugam, and Romuald Marappan. "Choose to be an auditor or a consultant." Corporate Ownership and Control 6, no. 1-2 (2008): 318–31. http://dx.doi.org/10.22495/cocv6i1c2p9.
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The paper looks at the evolving role of a Certified Public Accountant (CPA) as a result of the new guidelines and legislation being drawn out due to the recent litany of financial mismanagement cases in the corporate world. After Enron, WorldCom and Parmalat, the practice of employing an audit firm to perform auditing services as well as other consulting services for the same year has come under immense criticism, close scrutiny and review. This came about as it emerged that most of the accounting misdeeds were due to poor, lenient and condescending auditing practices by the firms that gained lucrative consulting work. This has been substantiated by an analysis done on the companies listed under the first board of BURSA MALAYSIA (KUALA LUMPUR STOCK EXCHANGE). The analysis contains a comparison of the fees paid by the companies towards audit as well as non-audit services to the same audit firm. This paper, thus, looks at the resultant effect and how an individual or corporation may proceed under the new accounting environment. It has been concluded that, while the law is a bit flexible towards the auditors accepting non audit work alongside audit work, it is the duty of the professional bodies to implement compelling codes of conduct. One of the ways identified is by ensuring that the accounting or management consultant of a company shall not accept to act as a statutory auditor for the same company in the immediate five years following the year in which the firm had acted as a consultant. A similar clause was imposed and is being implemented only by two countries around the world; Hong Kong and Singapore
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Blythe, Stephen E. "The In Pari Delicto Defense for Auditors in Professional Negligence Cases: Imputation of Managers’ Unlawful Acts to the Client Firm." Accounting, Economics and Law - A Convivium 5, no. 2 (July 1, 2015): 193–226. http://dx.doi.org/10.1515/ael-2013-0057.
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AbstractThe Enron scandal, the Sarbanes-Oxley Act and the 2008 financial crisis have resulted in new laws and regulations regarding auditor liability and an evolution of some of the old ones. One of the older laws is the in pari delicto defense: in a lawsuit brought by a corporation alleging that its auditor was negligent in failing to detect a manager’s fraud, the auditor may be able to use that defense if the manager’s fraud is imputable to the company. Since a bankruptcy trustee or a receiver steps into the shoes of the bankrupt company it represents, a similar defense (the Wagoner Rule) may also be applicable if a trustee or a receiver files a negligence lawsuit against the company’s auditor. However, in pari delicto is inapplicable when: (1) the wrongful acts of the manager are so adverse to the corporate client that the manager is deemed to have totally abandoned the corporation for its, or a third party’s, sole benefit (unless the manager is also the sole shareholder, or the company has incurred a short-term benefit because of the fraud); (2) the corporate client had at least one innocent manager or shareholder who could have prevented or stopped the fraud if he had known about it; (3) the auditor does not deal with the corporate client in good faith and engages in unlawful conduct; or (4) the plaintiffs are totally innocent shareholders (but in this case, the in pari delicto defense is still applicable with respect to culpable shareholders). The State of New York has been on the cutting edge in the evolution of the in pari delicto defense, and this defense is strongest there. Other states recognizing the defense include New Jersey, Pennsylvania, and (in dicta) Delaware (only if the company has engaged in actual wrongdoing). Finally, these are examples of recent evolution of in pari delicto: (a) the Sarbanes-Oxley Act’s prohibition of management from interfering with or deceiving the auditor; such statutory violations of management could be used by the auditor at trial in proving the applicability of the in pari delicto defense and (b) the new constraints on off-balance sheet leases, expected to be released shortly by the Financial Accounting Standards Board, may decrease management’s ability to deceive the auditor in the first place.
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Frutos-Peterson, C. "Enron Corporation and Ponderosa Assets, L.P. v. Argentine Republic (ICSID Case No. ARB/01/3) Annulment Proceeding Decision on the Argentine Republic's Request for a Continued Stay of Enforcement of the Award." ICSID Review 23, no. 1 (March 1, 2008): 164–74. http://dx.doi.org/10.1093/icsidreview/23.1.164.
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Ehmeza, Nasser, Abdelrazzag Elmajdoub, and Abubakr El-Mahmoudy. "Comparative pharmacokinetics and absolute bioavailabilities of two enrofloxacin generic preparations after single intracrop bolus administrations to broiler chickens." International Journal of Pharmacology and Toxicology 4, no. 2 (June 25, 2016): 115. http://dx.doi.org/10.14419/ijpt.v4i2.6248.
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The pharmacokinetics and absolute bioavailabilities of two generics of enrofloxacin (ENRO) 10% oral solution formulation at a dose of 10 mg/Kg body weight were compared after single intracrop (i.c.) bolus administrations in reference to single intravenous (i.v.) standard ENRO administration in broilers using a randomized parallel design. The two tested formulations were Enrol® (Medmac®, Amman, Jordan) as ENRO-A and Syvaquinol® (Syva®, Leon, Spain) as ENRO-B 10% oral solutions. An HPLC assay using pure ENRO base as a standard was used to measure concentrations of ENRO from the selected sources in plasma collected at predetermined time points up to 24 hours. The pharmacokinetic analysis of the C-T data was performed using non-compartmental analysis based on statistical moment theory with the help of computerized WinNonlin program (Version 5.3, Pharsight® Corporation, St. Louis, USA). The maximum plasma concentrations (Cmax) for ENRO-A and ENRO-B were 1.61 ± 0.203 and 1.79 ± 0.283 μg/mL, respectively, attained at time to peak (Tmax) of 2 h. Elimination half-lives (t1/2β) were 8.391 ± 0.312 and 8.458 ± 0.906 h, respectively. While areas under plasma concentration-time curves (AUC0-∞), and systemic bioavailabilities (F) were 12.744 ± 2.951 and 14.354 ± 2.85 mg.h/L; and 78.96 ± 6.728 and 88.94 ± 10.89 % for ENRO-A and ENRO-B, respectively. It could be concluded that despite the superior pharmacokinetic profile of ENRO-B over ENRO-A, however, both generics were within the FDA and EMA bioequivalence acceptance range of 80%–125% and thus can be used as interchangeable therapeutic agents in chickens.
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Ahmed, Waquar. "Neoliberalism, Corporations, and Power: Enron in India." Annals of the Association of American Geographers 100, no. 3 (June 25, 2010): 621–39. http://dx.doi.org/10.1080/00045601003794965.
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Castro V., René M., and Miguel A. Cano C. "BUEN GOBIERNO CORPORATIVO, SOLUCIÓN A LA CRISIS DE CONFIANZA: CAMBIOS EN LA CONTABILIDAD Y LA AUDITORÍA, APORTE DE LOS ESTÁNDARES INTERNACIONALES, APUNTES DE LA COMPARACIÓN DE LOS CASOS PARMALAT-ENRON." Contaduría Universidad de Antioquia, no. 44 (January 30, 2016): 17–51. http://dx.doi.org/10.17533/udea.rc.25665.
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Como solución a la crisis de confianza, se plantea el buen gobierno corporativo y sus afines códigos de buen gobierno, y buena conducta que se enmarcan dentro de la concepción de la ética como respuesta al flagelo de la corrupción. Si bien la gobernabilidad corporativa en su concepción general abarca diversos temas, con referencia al tema contable aborda los cambios en la contabilidad y la auditoria, el aporte de los estándares internacionales y las observaciones a partir de la comparación de los casos Parmalat-Enron. Respecto al buen gobierno se enuncian conceptos, componentes, procedimientos y compromisos, así como el nivel que presentan las directrices y los valores de la organización, la administración del riesgo y del control, la infraestructura y la tecnología.
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Hunter, Philip. "Email meets Enron to bring lawyers down on big corporations." Computer Fraud & Security 2007, no. 5 (May 2007): 18–20. http://dx.doi.org/10.1016/s1361-3723(07)70050-7.
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Carberry, Edward, and Edward Zajac. "How U.S. Corporations Changed Executive Compensation after Enron: Substance and Symbol." Academy of Management Proceedings 2017, no. 1 (August 2017): 15134. http://dx.doi.org/10.5465/ambpp.2017.15134abstract.
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Blair, Margaret M. "Post-Enron Reflections on Comparative Corporate Governance." Journal of Interdisciplinary Economics 14, no. 2 (April 2003): 113–24. http://dx.doi.org/10.1177/02601079x03001400202.
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In the heated debate of the last fifteen years over which of the world’s many different corporate governance systems are best, the shareholder primacy advocates thought they had won at the turn of the century. Now, in 2002, the helium has come out of the formerly high-flying technology and information infrastructure sectors that were leading the U.S. economic expansion in the 1990s, and the Enron fiasco and accounting scandals at numerous other U.S. corporations have exposed deep flaws in the system that had been held up as the model for all the world to follow. Many possible lessons can be drawn. At least one is that the high-powered incentives provided by stock option compensation may produce perverse behavior that can, in turn, undermine institutional arrangements that support and foster mutual trust and cooperation. The study of corporate governance must focus on more than just how to get management to maximize value for shareholders. It must also be about the human institutions that bind people together in cooperative relationship over long periods of time.
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Saraswat, Satya Prakash. "Reflections on Spiritual Foundations of Human Values for Global Business Management." Vision: The Journal of Business Perspective 9, no. 3 (July 2005): 1–9. http://dx.doi.org/10.1177/097226290500900301.
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Recent financial scandals at large multinational corporations such as Enron and WorldCom have brought into focus the need for “ethical” management in multinational corporations. For a deeper understanding of the issues, the spiritual foundation of ethics also need to be included in the academic dialogue and professional practice. In the Western countries, the discussion of spirituality in management is often limited to the Judeo-Christian tradition. With India and China becoming important players in the global economy, their spiritual traditions need to be included in the discourse to make it more comprehensive and relevant. This paper identifies fourteen principles of ethics from the Bhagavad-Gita and argues that it can be assimilated in the management practices of global corporations from a non-sectarian perspective. It identifies the sources of Hindu spirituality relevant to global business management, adumbrates the architecture of spirituality for business ethics, and provides an intellectual justification for a discussion of Hindu spirituality in relation to management.
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Creamer, Germán G., Salvatore J. Stolfo, Mateo Creamer, Shlomo Hershkop, and Ryan Rowe. "Discovering Organizational Hierarchy through a Corporate Ranking Algorithm: The Enron Case." Complexity 2022 (February 21, 2022): 1–18. http://dx.doi.org/10.1155/2022/8154476.
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This paper proposes the CorpRank algorithm to extract social hierarchies from electronic communication data. The algorithm computes a ranking score for each user as a weighted combination of the number of emails, the number of responses, average response time, clique scores, and several degree and centrality measures. The algorithm uses principal component analysis to calculate the weights of the features. This score ranks users according to their importance, and its output is used to reconstruct an organization chart. We illustrate the algorithm over real-world data using the Enron corporation’s e-mail archive. Compared to the actual corporate work chart, compensation lists, judicial proceedings, and analyzing the major players involved, the results show promise.
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Boatright, John R. "Reluctant Guardians: The Moral Responsibility of Gatekeepers." Business Ethics Quarterly 17, no. 4 (October 2007): 613–32. http://dx.doi.org/10.5840/beq20071742.
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ABSTRACT:Intermediaries, such as accountants, lawyers, and bankers, are gatekeepers, which are parties whose cooperation is necessary for corporations to function and who, by withholding cooperation, are able to prevent significant corporate misconduct. The recent scandals at Enron and other corporations were due, in part, to failures by gatekeeper institutions. However, intermediaries exist primarily to provide for-fee services and not specifically to detect and deter misconduct. Insofar as these institutions are gatekeepers or guardians, they serve reluctantly. Hence the question: What is the responsibility of intermediaries to act as gatekeepers? This article argues that the appropriate moral, as well as legal, principle for justifying responsibility in a gatekeeper role is cost effectiveness. This conclusion is reached by means of a hypothetical exercise called the investors’ bargain in which investors—who bear the costs and receive the benefits of intermediaries’ gatekeeper role—are asked to choose the best means of protecting their interests.
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Jeremiah Barasa Kabeyi, Moses. "Corporate Governance in Manufacturing and Management with Analysis of Governance Failures at Enron and Volkswagen Corporations." American Journal of Operations Management and Information Systems 4, no. 4 (2019): 109. http://dx.doi.org/10.11648/j.ajomis.20190404.11.
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Scrimgeour, Frank, and Geeta Duppati. "Corporate governance in the public sector: Dimensions; guidelines and practice In India and New Zealand." Corporate Ownership and Control 11, no. 2 (2014): 364–77. http://dx.doi.org/10.22495/cocv11i2c4p2.
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Corporate governance is obviously a matter of global concern and has gained tremendous importance in recent years in the context of globalisation of economies and financial markets. The financial crisis of 2008 and the 2012 European crisis involving Greece, Italy and Spain revealed corporate governance failures in financial institutions and corporations, leading to systemic consequences (Classens and Yurtoglu, 2013). Earlier, two major scandals: Enron and WorldCom in the USA resulted in the enactment of Sarbanes Oxley Act, 2002 as a measure to ensure and restore investors’ confidence in business in particular and the interest of society at large. This lead to corporate governance reforms worldwide impacting corporate board composition, conduct, and responsibility at the legal and regulatory levels.
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Thomas, Sibel Oktar. "A Fresh Apple or a New Barrel: Business Ethics from an Individual to Corporate Level." European Journal of Economics and Business Studies 8, no. 1 (May 19, 2017): 8. http://dx.doi.org/10.26417/ejes.v8i1.p8-15.
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The moral nature of corporations has been discussed for a long time. But, since 2001, with enormous economic effects of the misconduct of some corporations this discussion gained another dimension, it moved into the public sphere, the subject became more sensitive. The anger and mistrust of the public toward business triggered legislators and corporations to take urgent action. For example, just after the collapse of Enron (2001) the American Congress passed the Sarbanes-Oxley Act (2002) that covers the responsibilities of boards of directors and requires compliance training at all levels. It also revived the old controversial arguments about the nature of business – whether the only purpose of business is to make profits, the relationship of business and ethics – whether business ethics is an oxymoron, and human nature – whether it is ‘bad apples’ or ‘bad barrels’. Yet, with new sets of regulations, in 2017, we are still witnessing the misconduct of corporations on a global scale. This article investigates the effectiveness of corporate efforts such as revisiting mission statements, polishing the codes of ethics and conducting training, by evaluating the nature of business, human nature and the understanding of ethics in the workplace. By looking through the lens of utilitarianism of ethical issues in business, I will argue that codes of ethics and ethics training are necessary but not sufficient. Within the scope of this paper I wish to pave the way to a holistic approach which is necessary and sufficient to create ethical businesses.
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Turnbull, Shann. "Corporate accountability - an impact on community expectations." Corporate Ownership and Control 1, no. 1 (2003): 26–34. http://dx.doi.org/10.22495/cocv1i1p13.
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This paper anticipates proposals developed by the ’Corporate Governance Council’ set up by the Australian Stock Exchange (ASX) to advise on new guidelines. It identifies the invalidity of the assumptions implicit in the Sarbanes-Oxley Act in the US and the recommendations of the Higgs report in the UK into the role of non-executive directors. The conflicts of directors relying on management information to assess management and the business are considered. Also, the conflicts from the ASX trading its own shares and their requirement that corporations continuously disclose price sensitive information without permitting the market to be continuously informed about the identity of share traders. Ways of ameliorating these problems are suggested based on A New Way to Govern: Organisations and Society after Enron.
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Fiuza, Melissa Helena Bezerra, and Leandro Ferreira. "A GOVERNANÇA CORPORATIVA COMO INSTRUMENTO PARA EVITAR A FALÊNCIA DE EMPRESAS." Revista Ensaios Pioneiros 4, no. 1 (August 27, 2020): 61–78. http://dx.doi.org/10.24933/rep.v4i1.93.
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Com o decorrer dos anos, a necessidade de controle tornou-se evidente nas empresas, pois, muitos casos fraudulentos de informações financeiras, contábeis, sociais e ambientais ocorreram ao redor do mundo. Diversas empresas, chegaram a falência, outras tiveram suas operações prejudicadas. Com o advento da Lei Sarbanes-Oxley é possível controlar de forma evidente os possíveis erros e fraudes que podem ocorrer nas empresas. Casos como Enron, um dos maiores escândalos contábeis dos Estados Unidos, Petrobrás o maior escândalo de corrupção do mundo que se tem notícia até os dias atuais, além do Caso do Grupo OGX que tiveram suas informações falsificadas e levando os stakeholders comentem erros em seus investimentos, junto a essas empresas, em outros casos perderem todos os seus valores investidos. Com essas informações, o objetivo desta pesquisa é apresentar a importância da governança corporativa para a sobrevivência das organizações no mercado atual. As hipóteses a serem trabalhadas as empresas estão adotando a governança corporativa como ferramenta de gestão. A Metodologia utilizada nesta pesquisa é a bibliográfica, utilizando-se arquivos secundários como: revistas, jornais, relatórios de sustentabilidade, artigos acadêmicos e sites das organizações empresariais. Observa-se nas conclusões que sem a Governança Corporativa, as empresas tendem a terem dificuldades, chegando a possíveis falências.
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Goel, Sandeep. "Demystifying Earnings Management Through Accruals Management: An Indian Corporate Study." Vikalpa: The Journal for Decision Makers 37, no. 1 (January 2012): 49–56. http://dx.doi.org/10.1177/0256090920120104.
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Earnings, the “bottom line” or “net income,” are the single-most important item in financial statements. They indicate the extent of company's value-added activities. They help in resource mobilization in capital markets. On account of the said importance of earnings, the management of the company is always interested in their reporting. This is where management exercises choices for reporting of earnings. The recent Satyam saga or Enron in the past are prime examples of misuse of flexibility in choosing the accounting methods and treatments by the management. Earnings management occurs when management uses discretion in financial reporting and in structuring transactions with the objective of securing private gains. Earnings management issues related to financial disclosure and reporting are increasingly relevant to the multitude of firm stakeholders. In the wake of these manipulative corporate practices, investors and managers are trying to understand whether there is widespread Enron-like manipulation of financial results among corporations or whether these scandals are just an aberration. A related issue for financial analysts, investors, and corporate executives is how to distinguish between earnings manipulation that ultimately proves to be fraudulent and the day-to-day struggles of managers to meet pre-determined targets by using various accounting flexibilities. An understanding of the financial statement effects of financial engineering transactions will thus help managers try to avoid future Satyams and Enrons and help to improve the climate for a common investor. A very important dimension of earnings management is that earnings manipulation is usually not the result of an intentional fraud, but the culmination of a series of aggressive interpretations of the accounting rules and application of aggressive operating activities. The end result is misstatement of the financial results by the people involved and realization by them when it gets too late. The typical case of earnings manipulation begins with a track record of success. The company or division has posted significant sales and earnings growth over recent years. Their stock price trades at high price earnings multiple but unfortunately, it is becoming more difficult for the company to maintain the sales and earnings growth as per the analysts� expectations. The management goes for creative accounting practices to manage their earnings. This study analyses the earnings management practices in corporate enterprises in India by examining the magnitude of discretionary accruals. DeAngelo Model has been used for calculating discretionary accruals in regard to potential earnings management for the study. It also explores earnings management issues with respect to industry classification in these enterprises. The sample was drawn from the top 25 listed profit-making companies for the year 2007. The period chosen for the study was 2002–03 to 2007–08. An examination of the units shows a definite presence of accrual management in the sample companies. Most of the units have been found to be exercising income-increasing discretionary accruals. The earnings creativity is further strengthened by industry parameters among the units.
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Eulerich, Marc, and Artur Kalinichenko. "The Current State and Future Directions of Continuous Auditing Research: An Analysis of the Existing Literature." Journal of Information Systems 32, no. 3 (June 1, 2017): 31–51. http://dx.doi.org/10.2308/isys-51813.
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ABSTRACT Advances in information technology, especially the rise of the real-time economy and massive fraud scandals of corporations such as Enron, WorldCom, and Xerox, have led to significant changes in the business and risk environment of companies. As a consequence, requirements for the auditing profession have changed, and call for the use of new auditing technologies such as continuous auditing. Previous empirical literature has identified a high acceptance of continuous auditing by practitioners within internal audit departments and external audit firms. We conduct a content analysis of 100 continuous auditing papers from 38 different journals published between 1983 and 2015. Our literature review summarizes and classifies the existing literature on continuous auditing, examines the current state of knowledge of continuous auditing in AIS research, and suggests future research opportunities. JEL Classification: M40; M42; G34; G32; M4; G3.
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Trevia, Carlos Frederico, and Sandra Regina da Rocha-Pinto. "Os controles, a confiança e a ética na governança corporativa." Cadernos de Gestão e Empreendedorismo 6, no. 2 (September 20, 2018): 55. http://dx.doi.org/10.32888/cge.v6i2.12781.
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Passaram-se mais de dezesseis anos do escândalo da Enron nos Estados Unidos e os problemas de Governança Corporativa continuam. Recentemente no Brasil as notícias da operação Lava-Jato, envolvendo a corrupção em grandes empresas, mancharam suas imagens. O desenvolvimento da Governança Corporativa se torna assunto focal das empresas perante a falta de confiança dos mercados financeiros nas organizações e em seus processos de tomada de decisão não-transparentes, sem a clara responsabilização dos decisores, em meio à descoberta de diversas fraudes em projetos de investimentos financiados por instituições financeiras ou por seus acionistas, resultando em perda do grau de investimento e queda do preço das ações de empresas de capital aberto. Os mecanismos tradicionais de Governança Corporativa e os controles formais não enxergam todo o processo de tomada de decisão e se mostraram insuficientes para reduzir riscos. A cada dia a sociedade convive com mais sistemas abstratos, de modo que confiança, a etica e o controle social passam a ser condições essenciais para a redução de custos de controle e a geração de resultados. O objetivo deste artigo é apresentar um Quadro de Referência para aplicação no campo dos estudos organizacionais, em pesquisas empíricas, visando ao estabelecimento de uma Governança Corporativa com uma visão mais abrangente para as empresas, contribuindo para que se alcance um novo nível de Governança que traga benefícios aos acionistas e as sociedades, com etica e responsabilidade social. Para tanto, apresenta-se uma revisão bibliográfica sobre os problemas de Governança Corporativa enfrentados nas empresas e os mecanismos que têm sido destacados na literatura e propostos para a abordagem do problema.
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Robinson, Dahlia. "Auditor Independence and Auditor-Provided Tax Service: Evidence from Going-Concern Audit Opinions Prior to Bankruptcy Filings." AUDITING: A Journal of Practice & Theory 27, no. 2 (November 1, 2008): 31–54. http://dx.doi.org/10.2308/aud.2008.27.2.31.
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SUMMARY: This study examines whether auditors’ provision of tax services impairs auditor independence by focusing on auditors’ going-concern opinions among a sample of bankruptcy filing firms. The evidence from the bankruptcy setting is particularly salient given that the bankruptcy of corporations such as Enron motivated several provisions of the Sarbanes-Oxley Act (SOX) of 2002. More recently, auditors’ provision of tax service to their audit clients has been the focus of new rules by the Public Company Accounting Oversight Board (PCAOB). Consistent with improved audit quality from information spillover, the study documents a significant positive correlation between the level of tax services fees and the likelihood of correctly issuing a going-concern opinion prior to the bankruptcy filing. One implication of this result is that restricting tax services by auditors of poorly performing firms may diminish the quality of auditors’ reporting decisions without leading to an improvement in auditor independence.
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de Almeida, Jose Elias Feres, Alexsandro Broedel Lopes, Fabio Moraes da Costa, and João Batista Amorim Toniato. "Earnings management and industry classification in Brazil: An exploratory investigation." Corporate Ownership and Control 3, no. 1 (2005): 144–49. http://dx.doi.org/10.22495/cocv3i1c1p3.
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Enron and Worldcom accounting scandals brought new attention over the quality of financial accounting reports produced by listed corporations. Earnings management has generally been considered as the main cause of the alleged decrease in earnings relevance over the last decades (Lev, 1989). Following this line of inquiry this paper investigates earnings management activities of Brazilian firms. Prior research suggests that industrial organization can play a relevant role in motivating earnings management practices. To take this effect into account we control for industry classification using Economatica´s 20 sector definition excluding financial services, banks, insurance, and agribusiness. Our earnings management metric is based on the Kang and Sivaramakrishnan (1995) model. Results are only statistically significant for four sectors suggesting that industry classification does not explain the variance in earnings management activities for the selected sample. This output is not consistent with the stated hypothesis. Our findings contribute to the recent debate among practitioners, regulators and academics about the determinants of earnings management practices and accounting quality.
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Kangarlouei, Saeid Jabbarzadeh, Rezgar Talebpour Asl ., and Asghar azizi . "The Commitments Statement: A New Statement for Creditors." Journal of Economics and Behavioral Studies 4, no. 1 (January 15, 2012): 1–11. http://dx.doi.org/10.22610/jebs.v4i1.297.
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Much has been written lately concerning the failure of several major corporations to report their financial statuses accurately. Enron, Global Crossing, IBM and others have failed to provide accurate information to their investors and to provide full disclosure of liabilities that would influence the valuation. The present paper is focusing on creditors as a main group of accounting information users, which have been neglected, in field of information presentation. To solve this problem we introduce a new financial statement called “the commitments statementâ€. In the beginning, we point out financial reporting goals and users` informational needs. Then, we mention the issue, which creditors’ informational needs have not been well provided; and the reasons are explained. We continue with inspection of providing information related to solvency and recognition of financial flexibility of entities. Finally, we introduce “the commitments statement†and explain how to provide this statement. We end with the conclusion section.
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Crockett, Michael, and Muhammad Jahangir Ali. "Auditor independence and accounting conservatism." International Journal of Accounting & Information Management 23, no. 1 (March 2, 2015): 80–104. http://dx.doi.org/10.1108/ijaim-02-2014-0008.
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Purpose – The purpose of this paper is to examine the efficacy of the current legislative provisions that protect auditor independence in Australia. The collapses of several high-profile companies (Enron and WorldCom in the USA, HIH insurance and OneTel in Australia) in the early 2000s has raised questions about audit quality and independence. In response, regulators have introduced new regulations and guidance to improve audit quality. In Australia, the Corporations Act 2001 (2001) was amended via the Corporate Law Economic Reform Program Act 2004. This study poses the question: do non-audit service fees influence the level of accounting conservatism? Design/methodology/approach – The sample used in this analysis consists of all available Australian listed companies from the years 2006 till 2010. Findings – Using multiple measures of accounting conservatism and the auditor-client economic bond, our results suggest that the level of the economic bond between the auditor and the client does not significantly influence the level of accounting conservatism. Originality/value – Our results demonstrate that the combination of intrinsic market mechanisms and regulation in Australia sufficiently protect auditor independence.
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Fachada, Pedro. "A bolha e a tormenta." GV-executivo 1, no. 2 (October 3, 2003): 25. http://dx.doi.org/10.12660/gvexec.v1n2.2003.34797.
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O milênio começou com recessão, atentados terroristas espetaculares e escândalos corporativos, como as fraudes contábeis da Enron e da Worldcom. Nos EUA, a década de 1990 fora marcada pela escalada exagerada do preço das ações. A valorização do índice Nasdaq entre 1991 e 1999 alcançou quase 1000%. Desde o início de 2000 até setembro de 2002, porém, o mesmo índice amargou uma perda de mais de 71%. Com o estouro da bolha especulativa, o valor de mercado das empresas norte-americanas já encolheu US$ 7,6 trilhões. Qual é o impacto dessa reação aos excessos dos anos 1990?