The dubious deals
dutifully vanished from the audit reports, though they continue
apace. Andersen claims such transactions do not require disclosure
under Russian law.
How times change! Throughout the 1990's, Russia and its nascent
private sector were subjected to self-righteous harangues from
visiting Big Five accountants. The hectoring targeted the lack of
good governance among Russia's corporations and public
administration alike. Hordes of pampered speakers and consultants
espoused transparent accounting, minority shareholders' rights,
management accessibility and accountability and other noble goals.
That was before Enron. The tables have turned. The Big Five - from
disintegrating Andersen to KPMG - are being chastised and fined for
negligent practices, flagrant conflicts of interests,
misrepresentation, questionable ethics and worse. Their worldwide
clout, moral authority, and professional standing have been
considerably dented.
America's GAAP (Generally Accepted Accounting Practices) - once
considered the undisputable benchmark of rectitude and disclosure -
are now thought in need of urgent revision. The American issuer of
accounting standards - FASB (Financial Accounting Standards Board) -
is widely perceived to be an incestuous arrangement between the
clubby members of a rapacious and unscrupulous profession.
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