Comprehensive Case 1 . 1 Enron
1 . There were many parties responsible for the " crisis of confidence" made by the Enron debacle. Enron's executives had been responsible for their particular behavior in trying to change their financial statements. Andersen's auditors were responsible for not doing their particular jobs with integrity and not keeping their very own independence in from Enron. Regulatory groupings were in charge of making sure that companies and auditors are pursuing rules with regard to users of economic statements.
2 . 3 types of consulting providers that review firms are actually prohibited from providing to clients which can be public businesses include i . t work, assessments and value services, and internal examine outsourcing companies. Auditors shall no longer be allowed to offer such services while auditing a company mainly because they would become auditing their particular work or perhaps be put in a situation where they will want to alter an review based on their very own other use the company.
3. Andersen's engagement in the decisions concerning Enron's accounting and financial reporting did violate professional auditing standards. Andersen violated the auditing standard of independence. Andersen was involved in other locations of Enron's company that made these people audit work that they were a part of so they were no more independent of the review information. Andersen violated the auditing normal of preparing and oversight by certainly not appropriately organizing the review and supervisory the audit to find that they can were as well involved in the accounting of Enron to full the review. Andersen as well violated the auditing common of adequacy of disclosures by enabling Enron to use intentionally obscure disclosures about their Special Goal Entities.
4. Specialist auditing criteria referring to the preparation and retention of audit job papers require that there is proper planning of the audit operate...