Enron, WorldCom, Andersen et al.: a challenge to modernity [An article from: Critical Perspectives on Accounting]

This digital document is a journal article from Critical Perspectives on Accounting, published by Elsevier in 2004. The article is delivered in HTML format and is available in your Amazon.com Media Library immediately after purchase. You can view it with any web browser.

Description:
This paper uses the lens of Anthony Giddens' theories regarding the mechanisms which sustain late-modernist societies [The Consequences of Modernity, Polity Press, Cambridge, 1990; Modernity and Self-Identity, Polity Press, Cambridge, 1991] to analyse the 2001 and 2002 accounting and audit failures at Enron, WorldCom and Andersen. Assessments of risk and trust play a central role in Giddens' model, and this paper traces an escalating withdrawal of trust in systems of audit and accounting, and related increased perceptions of risk in corporate investment instruments. It also analyses regulatory responses aimed at sustaining or regaining public trust, and argues that failure to sustain such trust risks compromising the continued momentum of late modernity and the interests of people who benefit from institutions of late modernity.