The original Too Big to Fail

[AllentownJake]

Since 2001 and good old Arthur Anderson, a firm which was once the gold standard of accounting, was given the corporate death penalty. Each of the above firms have been involved in numerous firms that suddenly have blown up.

Pricewaterhouse was the auditors for AIG. E&Y were the auditors for Lehman. Deloitte had Bear Stearns.
KPMG had Countrywide.


Those explosions, were much more costly to the overall economy than Enron, Global Crossings, Waste Management etc which gripped the headlines in the early 2000s and late 1990s.

Arthur Anderson was given the proverbial corporate death penalty for those actions. My question is where are the investigations and prosecutions into the actions of these four firms. Why do they still exist. I believe the damage wrought in this last economic collapse is much larger than what Kenny boy Lay and Jeff Skilling were involved in, in 2001.

We supposedly had a strict adequate reform law passed in 2002 that was meant to prevent such shenanigans. It is 100% clear now, that those laws did not work.

What did the auditors know, when did they know it, and why did their audits fail to reveal the risk these companies were in before they went :nuke:

I have worked in this field for 7 years in both a public and private capacity, and I am literally ashamed of my profession in 2010 for letting people down in protecting the public from nefarious actors.

[dkf]

1. Is the problem accountants or accounting?

Wall Street spends it's money on shysters disguised as financial geniuses who make up whatever is needed to do whatever wall street wants. Accountants can only do as guidance directs them to.

[AllentownJake]

2. If I know that my house is going to go to a lawsuit

I don't sign of on any transaction, that I don't understand. I don't sign off, it doesn't exist.

[dkf]

3. Then we leave all statements incomplete?

How do we even get back to readable and transparent reporting? Would that require true unraveling of a multitude of instruments?

[AllentownJake]

4. Complex transactions are cleared with a firm's auditor before made nt.