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Accounting Controversies Essay

Category: Finance & Accounting Pages: 5 Type: Essay Level: Master
The firm also experienced a great loss even though the verdict has not yet been announced. Their clients retracted their loyalty and shifted to other competitive firms. Some employees resigned and sought other jobs from other companies. The accounting firm did a great job on the falsification and manipulation of Enron's financial statements that the discrepancies remained unnoticed to the public and to the government.
The implications of the scandal in the political arena was expected since it had close ties with the White House due to the fact that the once prestigious company spent millions of dollars to support Bush's presidential campaign last 2002 elections.
Aside from that, Enron's chief executive had personal and friendly relationships with Bush. The latter distanced from Kenneth Lay to prevent any public misconceptions. The investigations of the scandal also revealed that the company requested the presence of two US cabinet members preceding their file for bankruptcy.
Even the current vice-president Dick Cheney did not escape the political associations between the government and Enron. The vice resident had several meetings with the executives of the company in lieu of their energy administration plans.
The economic implications of the Enron case included the accounting industry's review of their financial policies with the fear of having the same fate as Enron. Other companies who also used the same aggressive accounting methods as Enron have been affected. They steered away from the limelight and have seemed to have lay-low for the meantime while the issues are still steaming.
Enron was not the only one negatively affected by the scandal for the same fate went to Arthur Andersen. He was found guilty of destruction of financial records which