THE LEGAL, ETHICAL, AND TECHNOLOGICAL CONCERNS OF THE...

New advancement in technology has made it easy for many CEOs to have the opportunity to loot their companies, and to engage in accounting irregularities. Technology has made improvements to the way a company does business with others, and also it has opened up ethical concerns for the way a company conducts their business. â€Å"Recently, accounting professionals have been placed under immense pressure by changes in the size and scope of financial markets† (Love, 2007 para. 1). Companies use the financial reporting system to communicate the financial effects of the company to outsiders (Love, 2007). This paper will discuss the legal, ethical, and technological concerns of the accounting, and financial reporting of businesses. A concern†¦show more content†¦Enron, a multinational company avoided showing their true financial statements for several years with the help of their auditor. Arthur Anderson, the company’s auditor signed off on the validity of the c ompany’s accounts despite the inaccuracies in the financial statements (Accounting ethics, 2011, para. 12). As a result of Arthur Anderson engaging in unethical practices, Enron’s shareholders lost their money when the company went into bankruptcy, Arthur Andersen employees lost their jobs, and the company went out of business (Accounting ethics, 2011, para. 12). Another example is Adelphia founder, and former CEO John Rigas. He was found guilty of looting Adelphia in 2005. (Mallor, Barnes, Bowers, Langvardt, 2010). Rigas, along with his son, and CFO Scott, was accused of using the company as their on private ATM to provide fifty million dollars in cash advances, buy 1.6 billion in securities, and repay 252 million in margin loans. As a result of their crimes Rigs received fifteen years in prison, and his son, and former CFO Scott, received twenty years in prison (Mallor et al., 2010). As a response to these major accounting scandals new reforms, regulations, and calls for higher education have been introduced to deter any individual from engaging in unethical behavior. According to Love, (2007) the Securities and Exchange Commission (SEC), the Financial Accounting Standard Board (FASB), and the Public Company Accounting Oversight Board (PCAOB) were