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Enron And The Sarbanes-Oxley Act Of 2002 (2002)

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Recommended: What events lead to the sarbanes-oxley act of 2002

For example, in 1989 Ernst & Whinney merged with Arthur Young to form Ernst & Young and Deloitte, Haskins & Sells merged with Touche Ross to form Deloitte & Touche, which created the Big Six. In 1998 Price Waterhouse merged with Coopers & Lybrand to form the Big Five.

In 2002, following the Enron and WorldCom accounting debacles, Arthur Andersen closed, which resulted in the current Big Four. As a direct result of the Enron and WorldCom events, US Congress passed the Sarbanes-Oxley Act of 2002 (SOX) to protect investors from the possibility of fraudulent accounting activities by corporations.

Toward the end of this period, all of the accounting firms except for Deloitte & Touche also divested themselves of their consulting practices, which …show more content…

For example, they make sure that records are accurate and that taxes are paid properly and on time. Accountants perform overviews of the financial operations of a business to help it run efficiently. They analyze profits and losses, providing information that investors and business owners need to evaluate how a company is doing over a period of time. The following are some of the duties that an accountant may have to perform:

Determine payroll requirements, maintain payroll data, and prepare and process monthly payrolls

Interact with internal and external auditors in completing audits

Explain billing invoices and accounting policies to staff, vendors, and clients

Prepare and review budgets, revenue, expenses, payroll entries, invoices, and other accounting documents

Analyze and review budgets and expenditures for local, state, federal, and private funding, and review contracts and grants

Prepare profit-and-loss statements and monthly closing and cost accounting reports

Analyze revenue and expenditure trends, recommend appropriate budget levels, and ensure expenditure control

Compile and analyze financial information to prepare entries to accounts, such as general ledger accounts, and document business transactions

Supervise the input and handling of financial data and reports for the organization’s automated financial

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