accounting scandals
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2021 ◽  
Vol 2 (2) ◽  
pp. 121-134
Author(s):  
Moh. Baqir Ainun ◽  
Tyasha Ayu Melynda Sari

Every ethnicity and culture is unique and contains good ethics for society. Various advice and advice from parents, teachers, and tribal leaders can be conveyed in unique ways such as through the typical proverb of the culture itself. This paper explores how beburghen becce' (good advice) contained in saloka Madura can be advice for auditors in carrying out the audit process so that accounting scandals such as Arthur Andersen and Enron do not recur. The research method used is the study of literature obtained from various sources. This paper explains that beburughen becce' (good advice) contained in saloka Madura such as pakoh ngenneng ka kaju (nails stuck to wood), lakona lakone kennengnganna kennengnge (employees work on the place they live in), mon kerras paakerres (if it is hard it must be crispy), oreng jhujhur mate ngonjhur (honest people die long), and sweet jhe' dhuli kalodhu' pae' jhe' dhuli paloa (sweet, don't swallow bitter, don't immediately spit it out) can provide advice for auditors to carry out audits with independence, responsibility, objectivity, integrity, and skeptical.    


2021 ◽  
Vol 7 (44) ◽  
pp. 2243-2252
Author(s):  
Burcu DOĞAN ◽  
Erdem HĠLAL

In our country, the accoutancy profession gained legal status on 13 June 1989 with the law numbered 3568. For more than 30 years, the requirements of the profession have been shaped by the law numbered 3568 for the activities of the accounting profession to keep up with the times. The audit profession and accountants were questioned after the accounting scandals that shook the whole World in the 2000. After the scandals in the profession, necessary steps were taken for the advent of the profession in our country as well as in the Word. The aim of this study is to examine the changes in the number of people who prefer in the light of these developments in the profession. İn light of the developments in the World, as a result of the increasing importance of the independent auditor’s profession, it is to determine the number of female auditors who perform the financial consultancy and subsequently continue their activities as auditors. Working in Ankara is the reason for choosing not constitute a significant proportion of the total number of financial advisory and auditing profession in Turkey. İn this study revealed how less female independent auditors perform this profession compared to male professionals. For this purpose, Ankara were examined by determining the number of women in proportion to the number of auditors and independent auditors in Turkey are given.


2021 ◽  
Vol 22 (8) ◽  
pp. 907-921
Author(s):  
Irina N. DERNOVSKAYA

Subject. Intended to counter fraud and unreasonably high bonuses for top executives, the U.K. corporate governance and audit reform implies some changes so as to improve the financial transparency of companies, primarily, large and public interest entities. The reform is called to maintain the lucrativeness and competitiveness of the U.K. financial markets, creating a sustainable and manageable environment, which major long-term investors seek. Objectives. I review and summarize proposals set out in the reform as best-in-class practices, which may work in auditing and assurance in Russia and underlie respective changes. The reform may contribute to the auditing profession, help avoid accounting scandals and corporate failure. Methods. Studying the audit reform, I applied methods of analysis, generalization, and analogy. Results. Having analyzed the reform plan, I found valuable ideas concerning directors’ responsibilities, corporate reporting and auditing. The reform suggests that the Audit, Reporting and Governance Authority should be established. The definition of public interest entities became broader. Audit boards are now to meet additional requirements. The audit market will be overhauled by segregating auditing and consultancy units of the Big Four companies and introducing statutory audit, which should be jointly performed by major and smaller entities, and tightening audit transparency rules. Hence, top executives will be more responsible and liable for financial reporting and increased transparency of internal control and trade account settlement principles. Such proposals should be adapted to the audit regulation practice in Russia and be applied with reference to the recent legislative novels. Conclusions. The quality of audit is critical for the economy and the public, since it ensures the national credibility as a capital market. Any sustainable economy needs a comprehensive approach, which combines the audit reform and corporate governance and accounting standards reform.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
K.L. Wasantha Perera ◽  
Roshan Ajward ◽  
Sisira Dharmasri Jayasekara

Purpose The purpose of this paper is to discuss the possible money laundering threats in fair value accounting practices giving particular attention to the list of predicate offences under recommendations of Financial Action Task Force (FATF). Design/methodology/approach This paper discusses case studies related to global accounting scandals and link outcomes of those scandals with the list of predicate offences given in FATF recommendations to build propositions. Findings The analysis reveals that legal proceedings on major accounting scandals show that legal proceedings have been restricted owing to a lack of evidence because of the technicality of frauds. Often the authorities have failed to prove cases under the list of current predicate offences which can be linked to accounting malpractices, i.e. fraud. Therefore, policymakers are required to revisit the list of predicate offences and the feasibility of considering accounting malpractices as a predicate offence to strengthen the corporate governance practices in regulated institutions. The adoption of fair value accounting practices provides opportunities to managers to adopt earnings management practices under a fair value accounting regime to maintain stable performance. The fair value practice recognizes unrealized gains which are not based on transactions giving bank managers an opportunity to repeat the outcomes of the discussed accounting scandals. Therefore, it is essential to criminalize accounting malpractices to strengthen the corporate governance practices in the banking industry and prevent possible accounting scandals. Research limitations/implications This study was designed to discuss the implications of fair value accounting practices on possible opportunities of money laundering. This paper provides only a viewpoint based on the analysis. Therefore, an empirical analysis is required to establish the authors’ views in a fair value accounting regime. Originality/value This paper is an original work done by the authors which discuss the implications of fair value accounting practices on possible money laundering. The views are original ideas of the authors in this context.


2021 ◽  
Vol 2 (1) ◽  
pp. 39-47
Author(s):  
Yana Ustinova

Dynamic changes and observed crisis phenomena in the economy, as well as high-profile accounting scandals of recent decades and subsequent revisions of accounting standards, necessitate a critical assessment of the conceptual framework for preparing financial statements that are adequate to the real state of affairs. At the same time, the accumulated practice of applying the true and fair view concept revealed some shortcomings. In this situation, the center of attraction of researchers' interest is the question of whether this concept meets the modern challenges of accounting, whether it is advisable to preserve and develop it. The aim of the article: an overview of the main research trends describing the significance of this concept for the current state of accounting, an assessment of the stages of their development. The analysis was carried out through research of scientific publications. The result was the identification of the main researching areas of the true and fair view concept, an analysis of their changes over time, an overview of the current increment of scientific knowledge, and the factors that led to such an increment for the last few years. In the course of the work, the areas of emerging scientific interest, as well as areas of maintaining scientific interest, were noted from the position of enriching theoretical and practical knowledge about the applicability of the concept. Special attention was drawn to the following issues: the relationship between overrides from accounting standards and the quality of financial statements, options for interpreting the concept by various groups of users of financial statements in settings of the legal and socio-cultural context differences, the role of auditors in assessing of the compliance with this concept. In conclusion were called the arguments of supporters to recognize this concept as worthy of banning, as well as the arguments of supporters to recognize this concept as worthy of keeping. Prospective directions of future scientific research in this direction were proposed.


Author(s):  
Tamara Poje ◽  
Maja Zaman Groff

AbstractThe attention being paid to ethics education in accounting has been increasing, especially after the corporate accounting scandals at the turn of the century. This paper provides a comprehensive overview of the existing research in the field of ethics education in accounting. To synthesize past research, a bibliometric analysis that references 134 primary studies is performed and three bibliometric methods are applied. First, we visualize the historical evolution of ethics education in accounting research through historiography. Second, we use bibliographic coupling to identify clusters of ethics education in accounting research before, during, and after major corporate scandals. Third, we perform a co-word analysis to connect the identified patterns into a map of a contextual space. The results reveal, in each decade, not only an increasing academic focus on this field of research, but also an increasing number of different research clusters. While the clusters Factors affecting moral judgement, Perception of ethics, and Lack of ethics topics in the last research period develop further from the respective clusters in the previous periods, Accounting beyond technical skills, Integration of ethics in accounting education, Use of developed ethics frameworks, and Professional values on the contrary develop anew in the last decade, as a consequence of a growing demand for teaching ethics. Overall, the paper presents the development patterns of ethics education in accounting research and sets up a research agenda that encourages future research.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Thereza Raquel Sales de Aguiar

Purpose The purpose of this paper is to explore issues related to the use of financial accounting and reporting by discussing three interrelated areas: the theoretical foundations, the framework and practicalities. The paper also discusses participatory and pluralistic approaches to accounting and corporate governance as alternatives to address some of these issues. Design/methodology/approach This is a narrative research based on deductive thematic analysis of secondary data. This study provides a general overview of the existing literature of the limits of the use of financial accounting and its impact on business and society. Findings In terms of the theoretical foundations, this paper contrasts financial accounting explained by agency theory and a dialogic accounting approach. The findings of this study emphasise the need to establish an accounting framework for the interests of the many (not the few) in conjunction and simultaneously with a participatory and pluralistic approach to corporate governance. Finally, this paper explores accounting for carbon emissions and recent financial accounting scandals to analyse the impact of the inappropriate use of financial accounting and reporting in business and society. Originality/value This paper provides an overview of the limits of the use of financial accounting by exploring its theoretical background, framework and practicalities. The paper also discusses the need for new accounting and corporate governance frameworks that allow a pluralistic and participatory approach to the decision-making of companies.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Rabih Nehme ◽  
Amir Michael ◽  
Jim Haslam

Purpose A survey is here systematically conducted to analyse auditors’ perceptions of dysfunctional auditing behaviour (DAB). As a result of many accounting scandals and litigations faced by audit firms, this paper aims to assess whether factors leading to DAB are embedded in audit firms’ practices. Design/methodology/approach The sample used in this study comprises auditors at all levels of employment with the big four audit firms in the United Kingdom (UK). DAB is analysed using two signals/indicators: premature sign-off and under-reporting of chargeable time. Time budget pressure and time deadline pressure are the factors considered here as potentially pushing auditors to exhibit DAB. A careful and considered analysis and interpretation is here articulated. Additionally, the sample individuals are divided into audit trainees and experienced auditors to assess any potential differences in the perception of DAB that reflect the experience factor. Findings Coordination with internal auditors, different perceptions between audit trainees and experienced auditors of dysfunctional behaviour, working during their personal time and the box-ticking exercise are amongst the findings that may help practitioners to understand the reasons behind dysfunctional behaviour and identify measures to mitigate it. Originality/value The study can aid concerned executives and audit partners to minimise DAB related to different time pressures by casting light on the key ethical issues. The study is conducted on a sample of the big four firms in the UK covering all organisational structure. It assesses if experience plays a role in the perception of DAB.


2021 ◽  
Vol 26 (1) ◽  
pp. 35-60
Author(s):  
Michael Jones ◽  
Patricia Stanton

A sample of editorial cartoons published following the wave of accounting scandals in the United States culminating in the collapse of Enron and the demise of the auditors Arthur Andersen LLP was examined to explore the portrayal of accounting, accountants and auditors. The nature and importance of the cartoons was also investigated. While the examination revealed what cartoonists had to say about accounting, accountants and auditing, the purpose was to ascertain the stereotypes conveyed. The cartoonists working from established preconceptions of accounting and accountants redefined and reshaped accounting stereotypes. They replaced the dull but honest image with a negative one, the fraudulent accountant. However, the image of the male accountant survived. As social critics, the cartoonists focused on the consequences on employees and stockholders but neglected to address the consequences for business institutions.


Author(s):  
Christianna Chimonaki

This chapter begins with the definitions of creative accounting, fraud and financial statement fraud and explains the relationship between them. Next, it presents the classical theories on the determinants of financial statement fraud. Section 1.4 presents the profile of accounting scandals. Section 1.5 presents the components of financial report fraud as well as the parties involved in in creative accounting. Section 1.6 presents the reasons and motivations for creative accounting. Specifically, the authors analyse manipulation practices, the methods and the opportunities for creative accounting and address why financial frauds occur. Finally, they offer conclusions in Section 1.7.


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