Deceptive Accounting and the Global Financial Crisis

Deceptive Accounting and the Global Financial Crisis Name Course Tutor Date Introduction As with other disciplines, all personnel in the accounting profession ought to uphold high standards of professional ethics. All firms ought to conduct their affairs with due regard to the welfare of the parties involved, the economy, and the interests of the public in general. As such, auditors and accountants ought to be ambassadors of transparency and accountability and their conduct must indicate as much. In the wake of the housing bubble, the integrity of the accounting profession came into question amid claims by observers that key professional services firms such as Deloitte Touchà ©, PricewaterhouseCoopers (PwC), KPMG, and Ernst Young were colluding with their client firms to perpetuate deceptive accounting in a way that the financial position of the client-firm appeared more stable and progressive. This helped the global financial crisis along. Amid the crisis, world economies tanked causing the fall of major economic giants. The unprecedented collapse of Lehman Brothers, American International Group (AIG), General Motors, WorldCom, Enron, Fannie Mae and Freddie Mac nearly took the global economy down with it. In light of emerging studies, corporate malfeasance was one of the leading causes for the collapse. All firms ought to conduct their affairs with due regard to the welfare of the parties involved, the economy, and the interests of the public in general underShow MoreRelatedA Multi Dimensional Inventory Analysis Of The Individual Benefits Of This Class By Putting Creating A Concise Plan1253 Words   |  6 Pagesthat I can apply the stakeholder management knowledge in the real business world. Even though, I might not be an entrepreneur after HULT, I still can use this knowledge as employee in a company. For the reason that I had work experience in financial and accounting for 5 years, but I have never consider about stakeholder management concept before. I think if I profoundly understood this management, I would have managed my work more effect ively and increased communication and collaboration in my workplaceRead MoreThe Parmalat Scandal Report : Parmalat2351 Words   |  10 Pagesemploying more than 36,000 employees. In 2003 the company collapsed with a â‚ ¬14 billion hole in its accounts and it is still considered the Europe’s biggest bankruptcy. Key Players in the scandal Calisto Tanzi - 10-year sentence for market rigging, accounting fraud(2009) Fausto Tonna, CFO - 2-year sentence for forgery, creating many offshore companies Grant Thornton firm - lawsuits filed dismissed in 2009 Deloitte and Touche firm Citicorp - Parmalat was ordered to pay $364.2 million When did it happenRead MorePossible Exam 310042 Words   |  41 PagesQuestions True or false: 1. Due to insurance arrangements and the securitization of mortgage investments, many U.S. bankers did not adequately gauge the risks of subprime loans. TRUE 2. A commonly accepted theory is that the Subprime lending crisis was due the Government placing more restrictions and regulations on the investment banking industry starting in 1999. FALSE 3. For the most part, the credit ratings granted to mortgage-backed securities did not accurately reflect the true riskRead MoreHome Depot Implements Stakeholder Orientation2623 Words   |  11 Pagescustomers, interest groups, the legal system, and the community often determine whether a specific action is right or wrong and ethical or unethical. II. Why Study Business Ethics? A. A Crisis in Business Ethics 1. Reports of unethical activities (accounting fraud, insider trading, falsifying documents, deceptive advertising, defective products, bribery, abusive behavior, harassment, and employee theft) are cited as evidence of declining ethical standards, not only in business, but also in governmentRead MoreHigh Risk Investments2521 Words   |  11 Pagesattracted to high-risk investments, such as exchange-traded derivatives, global funds, and other complex investment vehicles. The second section will concern the analysis of the risk associated with exchange-traded derivatives, such as futures and options, and what brokers might do to minimize the risk to investors. The third section will involve a discussion of the challenges related to regulating a complex global financial firm, and make suggestions for regulatory improvements. The next sectionRead MoreLehman Brothers : The Top 5 Global Investment Banks Essay2537 Words   |  11 PagesQ1. Lehman Brothers was the top 5 global investment banks who operated in U.S for more than 150 years providing services in Investment Banking(dealing with mergers acquisitions), Capital Markets(dealing with equity fixed income products), and Client Services(dealing with private client private equity businesses) to corporate, government, clients institutes having greater net worth . A brief history- 1. 1840- Henry Lehman migrated from Germany to Montgomery, Alabama and opened up a smallRead MoreDiscussion and Critical Review of the Equity Premium Puzzle2970 Words   |  12 Pagesphenomenon. This opinion is certainly relevant, considering the recent changes in the financial markets performance. During the past decade stock market outlived severe recession and crash of financial markets, that significantly decreased the average returns on equities and increased volatility. The second part of the paper will discuss both of these notions (selection and survivorship bias) and analyze recent financial data on stock returns observed in last 30 years. Myopic loss aversion Among theRead MoreDiamond Foods Accounting Scandal3150 Words   |  13 Pages Diamond Foods Accounting Scandal BACKGROUND: Founded in 1912 as a walnut grower cooperative, Diamond Food’s primary business involved buying walnuts from local California growers, processing the product, and reselling it. The San Francisco-based company converted from a cooperative to a public corporation in July of 2005, issuing its initial shares for $17. By 2010, Diamond Foods (DMND) had expanded and acquired a number of snack food companies including Kettle Brand ® Chips and Pop Secret ® popcornRead MoreThe Debt Crisis of Nigeria and Greece5186 Words   |  21 PagesThe debt crisis of Nigeria and Greece Introduction National debt is a problem that can inflict any country including the developed countries. Almost all countries go into budget deficit one way or the other and end up borrowing money. The most direct effect of the government debt is to place a burden on future generations of taxpayers. When these debts and accumulated interest come due, future taxpayers will face a difficult choice. Inheriting such a large debt cannot help but lower the livingRead MoreFraud Triangle Not Good Enough3956 Words   |  16 PagesStraight-line reporting authority Dual responsibility Single suppliers Local or regional service area Step-up salary structure CEO as businessman Businesses led by owners 2000s Matrix organizations Autonomous authority Multiple vendors and global trading partners Global reach Performance-based pay CEO as celebrity Businesses led by managers and directors Issues With the economic downturn forcing budget cuts, reorganizations, and work force reductions, the pressure on corporations and key individuals