Accountability When Do We Hold the Accountants Essay

Open, View, and/or
Download this Document

Total Length: 608 words ( 2 double-spaced pages)

Total Sources: 1+

Page 1 of 2

Accountability

When do we hold the accountants accountable?

In the wake of accounting scandals at Enron and WorldCom, the question arose: how to hold accountants accountable, when it is they who are supposed to be the objective determinants of a firm's financial ethics? Merely having to 'sign off' on an audit was not enough to ensure that the accountants at firms as reputable as Arthur Anderson adhered to GAAP (Chartier 2002). The need for ethical accounting is vital to ensure that companies act with all due transparency: "Accounting fraud usually occurs when a company overstates its assets or revenue, or understates its liabilities and expenses. Companies feel the pressure to commit such acts because the market reaction can be harsh for companies if their revenue projections do not match actual earnings. In addition, senior corporate officials' compensation packages may be directly tied to hitting targeted earnings. Thus, this creates an insatiable need to ensure that the corporate earnings projections are precisely hit" (Tinker 2011).

Stuck Writing Your "Accountability When Do We Hold the Accountants" Essay?

View All Our Example Accountability When Do We Hold the Accountants Essay

Have A Custom Example Essay Written



Given the strong financial interests that managers have to 'look the other way' when fraud is committed, or to outright condone it, accountants must be the final barricades against such malfeasance. When senior management's salaries are yoked to the financial performance of the firm, this, statistically speaking, increases the likelihood of fraud. Financial statement fraud cases caused more than $4 million dollars in losses in 2012 (Tinker 2011). Additionally, private companies are not governed by the provisions of Sarbanes-Oxley or the standards of the Public Company Accounting Oversight Board (PCAOB) so some companies are even less 'accountable' for potential abuses than others.

For companies that are affected by SOX, "which establishes corporate and criminal fraud accountability for certain willful violations" of accountants, "third-party claims may require evidence of fact-specific conduct and relationships between the third party and the accountant or….....

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"Accountability When Do We Hold The Accountants" (2012, December 09) Retrieved June 4, 2026, from
https://www.aceyourpaper.com/essays/accountability-hold-accountants-83598

Latest MLA Format (8th edition)

Copy Reference
"Accountability When Do We Hold The Accountants" 09 December 2012. Web.4 June. 2026. <
https://www.aceyourpaper.com/essays/accountability-hold-accountants-83598>

Latest Chicago Format (16th edition)

Copy Reference
"Accountability When Do We Hold The Accountants", 09 December 2012, Accessed.4 June. 2026,
https://www.aceyourpaper.com/essays/accountability-hold-accountants-83598
   

Open, View, and/or
Download this Document
order custom essay example