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Tax Law

Selected Works

Enron

Publication Year

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Full-Text Articles in Law

"Tax Services" As A Trojan Horse In The Auditor Independence Provisions Of Sarbanes-Oxley, Matthew J. Barrett Oct 2013

"Tax Services" As A Trojan Horse In The Auditor Independence Provisions Of Sarbanes-Oxley, Matthew J. Barrett

Matthew J. Barrett

This article argues that the failure of the Sarbanes-Oxley Act of 2002 (SOx) to prohibit auditors for public companies from also providing tax services to audit clients or their executives and selling tax shelters to anyone remains a Trojan horse that threatens both the investing public and the auditing profession. Although SOx enacted several reforms designed to enhance auditor independence, the legislation and implementing regulations that the Securities and Exchange Commission (SEC) subsequently promulgated allow an auditor for a publicly traded company to provide tax services to the company as long as the audit committee preapproves the engagement. As the …

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Enron And Andersen - What Went Wrong And Why Similar Audit Failures Could Happen Again, Matthew J. Barrett Dec 2003

Enron And Andersen - What Went Wrong And Why Similar Audit Failures Could Happen Again, Matthew J. Barrett

Matthew J. Barrett

This chapter from Enron: Corporate Fiascos and Their Implications (Nancy B. Rapoport & Bala G. Dharan, eds., Foundation Press 2004) posits that unconscious bias, compounded by organizational flaws and a culture at Andersen that emphasized marketing non-audit services to audit clients in an effort to boost profits; significant conflicts of interest and self-interest; and greed all help explain the audit failure at Enron. Although the Sarbanes-Oxley Act of 2002 attempted to strengthen auditor independence, under the guise of increasing auditor independence, a public company's management can still recommend that the audit committee hire another accounting firm to provide tax or …

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Enron, Accounting, And Lawyers, Matthew J. Barrett Dec 2001

Enron, Accounting, And Lawyers, Matthew J. Barrett

Matthew J. Barrett

Enron's collapse painfully illustrates the importance of financial accounting to all lawyers. Accounting is often referred to as "the language of business." Virtually every lawyer represents businesses, their owners, or clients with adverse legal interests, such as creditors and customers. Especially after Enron, lawyers cannot competently represent clients if they do not grasp certain basic principles about accounting. This article lists the top ten accounting lessons that any lawyer could learn from the scandal. These lessons include the components of a complete set of financial statements, the choices inherent in generally accepted accounting principles, the distortions possible in pro forma …

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