Asked by Sondos Alansari on Jul 07, 2024
Verified
Why has the reputation of U.S. accounting standards decreased in recent years?
A) The U.S. deficit is at a record high.
B) Many U.S. businesses have declared bankruptcy.
C) There have been some notable American accounting scandals, such as Enron.
D) Lengthy prison sentences have been given to unethical American executives, such as Bernie Madoff.
Enron
A former American energy company known for its massive accounting fraud that led to its bankruptcy in 2001.
U.S. Accounting Standards
The rules and guidelines set out by governing bodies, like the Financial Accounting Standards Board (FASB), for companies in the United States to follow in their financial reporting.
American Accounting Scandals
Major financial frauds and malpractices involving accounting methods that have occurred in the United States, leading to loss of investor trust and changes in regulations.
- Gain insight into the mechanisms of financial reporting globally, especially the motivations behind the adoption of IFRS or other guidelines.
Verified Answer
MC
Meghann CarterJul 12, 2024
Final Answer :
C
Explanation :
There have been several high-profile accounting scandals in the U.S., such as Enron, which have damaged the reputation of U.S. accounting standards. These scandals have led to increased scrutiny and criticism of U.S. accounting practices, both at home and abroad.
Learning Objectives
- Gain insight into the mechanisms of financial reporting globally, especially the motivations behind the adoption of IFRS or other guidelines.