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Review of Accounting Ethics

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| Assignment 1: Review of Accounting Ethics | | |

| Assignment 1: Review of Accounting Ethics | | |

Doing the right thing matters. Every day, workers make decisions that are vital to a company’s success. How those decisions are made is just as important as the decisions themselves. In every company there are shareholders, consumers, business partners, and employees who have placed their trust in workers to act sincerely, rationally, and in accordance with the utmost ethical and legal standards. Albert Einstein once said that “relativity apples to physics, not ethics.” I perceive this to mean that there should never be a relative situation when it comes to ethics; there is a right and wrong choice. We as human beings need to ensure that we remain exactly that, human beings. Unfortunately, the world is not perfect. There are criminals, liars, cheaters, and scammers who hide in plain sight everywhere we go. Less than 15 years ago, there was a time where multiple financial scandals had been reported taking place in very successful companies, including Enron, WorldCom, AIG, and others (Weygandt, Kimmel, Kieso, 2012, p. 7). The number and magnitude of these scandals resulted in great suspicion of financial reporting, which proved to be detrimental to a company’s success. In my opinion, the most memorable scandal to have taken place in the business world during that time was Enron. During its existence, Enron was an American energy company based in Houston, Texas, and there were some very high hopes for this company. Christopher Palmeri wrote an article about Enron in 1998 in Forbes magazine, where he stated “If Skilling is even half right, Enron's current investments will seem very smart.” This statement was made in contradiction to Enron’s underperformance in the S&P500 and amongst its peer group from 1995-1998. Palmeri, along with

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