Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Case 2.1 Enron: Independence.

Slides:

Advertisements

Similar presentations

Building on Our Core Values Building on Our Core Values © 2003 by the AICPA The Sarbanes-Oxley Act.

Advertisements

Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Case 4.4 WorldCom: The Internal Audit Function.

1 4 th session: Corporate Governance – Sarbanes Oxley Performance Evaluation IMSc in Business Administration October-November 2009.

4 - 1 ©2006 Prentice Hall Business Publishing, Auditing 11/e, Arens/Beasley/Elder Professional Ethics Chapter 4.

Introduction  Enron and other corporate scandals resulted in the demise of Andersen and passage of the Sarbanes-Oxley Act  The Act establishes the Public.

Professional Ethics Chapter 4.

Sarbanes-Oxley Act of 2002.

Case 6.1 Enron Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill.

September 2002 Corporate Governance: Can You Afford To Wait? The information provided here is of a general nature and is not intended to address the specific.

Sarbanes-Oxley Act of Benefits of Act Three quarters of the financial executives in the Oversight Systems survey said that their company had realized.

By Aleksandra Whistle, Rachel Davis and Jie li

Professional Ethics Chapter 4 By Arens et.al.,. Learning Objective 1 Distinguish ethical from unethical behavior in personal and professional contexts.

Auditor Independence Co. Investor hiresreports Auditor.

Copyright © 2010 South-Western/Cengage Learning

Chapter 5 Professional Ethics.

SARBANES-OXLEY ACT OF 2002 Overview and Update. 2 Accounting Governance (Before Sarbanes-Oxley Act 2002) SEC has always had statutory authority to oversee.

MODERN AUDITING 7th Edition

SARBANES-OXLEY ACT OF 2002 Overview and Update. Copyright, K. Klose, UMUC, Accounting Governance (Before Sarbanes-Oxley Act 2002) SEC has always.

1-1 McGraw-Hill/Irwin ©2005 by the McGraw-Hill Companies, Inc. All rights reserved. Chapter 1 Auditing and Assurance Services "If you want to be successful,

© The McGraw-Hill Companies, Inc., 2004 Slide 12-1 McGraw-Hill/Irwin Chapter Twelve Financial Reporting and the Securities and Exchange Commission.

Professional Ethics. McGraw-Hill/Irwin © 2004 The McGraw-Hill Companies, Inc., All Rights Reserved. 3-2 Steps in Resolving an Ethical Dilemma Identify.

Significant Business Acquisitions

Professional Responsibility

The Baptist Foundation of Arizona

BA 427 – Assurance and Attestation Services Lecture 29 Auditor Independence – Current standards.

The Age of Compliance How Sarbanes-Oxley affects IT management.

ACCT 742: Advanced Auditing

Overview of Sarbanes-Oxley Act

Legal Issues in Finance

Changes in the Profession Alan Anderson, AICPA Senior Vice President.

Case 6.3 WorldCom Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill.

Summary of the Investor Protection, Auditor Reform, and Transparency Act of 2002 (Sarbanes-Oxley Act)

Signed into law on July 30, 2002 Response to highly publicized corporate scandals Provisions affect corporate governance, accounting, and auditing Purpose.

Sarbanes Oxley Act. The Sarbanes Oxley Act consists of 11 Sections I – Public Company Accounting Oversight Board II – Auditor independence III – Corporate.

Striving for Absolute Independence – Will the Prohibition of Non-Audit Services Result in Better Audits? Hardld RING Vice President, Institut der Wirtschaftsprufer.

Ethics and the Audit Profession

© 2010 The McGraw-Hill Companies, Inc. Managerial Accounting and the Business Environment Chapter 1.

General Computing Controls

©2010 Prentice Hall Business Publishing, Auditing 13/e, Arens/Elder/Beasley Professional Ethics Chapter 4.

Building on Our Core Values Building on Our Core Values The Sarbanes-Oxley Act Public Law (JFZ edited)

The New SEC Auditor Independence Rules: Implications for Audit Committees and Management

WorldCom This fraud occurred in a major public company and went undetected for 3-4 years. How could this occur? Why did this occur? Was Betty Vinson a.

Case 2.4 Enron: Quality Assurance

Case 3.6 Bernard L. Madoff Investment and Securities: Understanding the Client’s Business and Industry Copyright © 2014 McGraw-Hill Education. All rights.

Case 2.6 Bernard L. Madoff Investment and Securities: A Focus on Auditors’ and Accountants’ Legal Liability Copyright © 2014 McGraw-Hill Education. All.

The Definition of an Asset

©2008 Prentice Hall Business Publishing, Auditing 12/e, Arens/Beasley/Elder Professional Ethics Chapter 4.

+ Enron the Unsinkable Ship Nancy Vazquez. + Overview Describe the concept of ‘Creative Accounting’. How the unsinkable ship was sunk to the bottom of.

Case 6.2 Waste Management Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent.

©2012 Prentice Hall Business Publishing, Auditing 14/e, Arens/Elder/Beasley Professional Ethics Chapter 4.

Case 1.12 Bernard L. Madoff Investment and Securities: The Role of the Securities & Exchange Commission (SEC) Copyright © 2014 McGraw-Hill Education. All.

Understanding the Client’s Business and Industry

Case 4.3 The Baptist Foundation of Arizona: The Whistleblower Hotline Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution.

Building on Our Core Values Building on Our Core Values © 2003 by the AICPA The Sarbanes-Oxley Act.

©2010 Prentice Hall Business Publishing, Auditing 13/e, Arens/Elder/Beasley Professional Ethics Chapter 5.

Case 1.7 WorldCom: The Expense Recognition Principle Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without.

Sarbanes-Oxley: Its effect on the accounting profession Signed into law on July 30, 2002 Response to highly publicized corporate scandals Provisions affect.

Enron: Audit Documentation

Case 1.8 Bernard L. Madoff Investment and Securities: Broker-Dealer Fraud Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction.

Impact On Government Contractors

Summary of the Investor Protection, Auditor Reform, and Transparency Act of 2002 (Sarbanes-Oxley Act)

Professional Ethics Chapter 4.

The Expense Recognition Principle

Enron: Presentation and Disclosure of Special Purpose Entities

The Baptist Foundation of Arizona: The Conservatism Constraint

The Sarbanes-Oxley Act

Dr. Donald K. McConnell Jr.

Dr. Donald K. McConnell Jr.

Dr. Donald K. McConnell Jr.

Presentation transcript:

Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Case 2.1 Enron: Independence

2 Enron Case Relevant Technical Knowledge SARBOX Section 201  it shall be unlawful for a registered public accounting firm to provide any non-audit service to an issuer contemporaneously with the audit, including: (1) bookkeeping; (2) financial information systems design and implementation; (3) appraisal or valuation services, fairness opinions, or contribution-in-kind reports; (4) actuarial services; (5) internal audit outsourcing services; (6) management functions or human resources; (7) broker or dealer, investment adviser, or investment banking services; (8) legal services and expert services unrelated to the audit; (9) any other service that the Board determines, by regulation, is impermissible.

3 Enron Case Relevant Technical Knowledge SARBOX Section 203  the lead audit or coordinating partner and the reviewing partner must rotate off of the audit every 5 years SARBOX Section 206  requires a “one year cooling off period” before an audit firm employee accept a position as CEO, CFO, Controller, or Chief Accounting Officer of a former client

4 Enron Case Relevant Technical Knowledge SARBOX Section 301  requires that the “audit committee of an issuer shall be directly responsible for the appointment, compensation, and oversight of the work of any registered public accounting firm employed by that issuer.”

5 Psychology Literature - How to Best Acquire Knowledge  Feature Repeated Case Experiences with Feedback; and  Teach Technical Concepts within Real- Life Contexts  Consider the following additional cases: The Fund of Funds: Independence Sunbeam: Due Care WorldCom: Professional Responsibility

6 Epilogue - Enron  Cliff Baxter, Vice Chairman, committed suicide due to fraud  Arthur Andersen indicted for obstruction of justice due to destroying evidence and barred from auditing public companies for five years  Former CEO Jeffrey Skilling sentenced to 24 years in prison

7 Epilogue - Enron  Founder Kenneth Lay dies from a heart attack before his sentencing  Many top Enron executives were sentenced to multi-year prison terms.  Eligible shareholders will receive $7.2 billion in settlements for their investment losses