Following spectacular corporate scandals that badly tainted their profession, 5,000 of the world's accountants gathered in Hong Kong yesterday and acknowledged their image needs some major repair work.
The "E-word" was on everyone's lips as the World Congress of Accountants opened its meeting, held once every five years.
"Everything changed after Enron," said Oktay Guvemli, a 65-year-old accountant from Turkey.
PHOTO: REUTERS
The collapse of the US energy trader, which rocked longtime accountant Arthur Andersen when evidence of document-shredding emerged and led to a criminal conviction, turned into a "wake-up call for the profession," British accountant Steven James Apedaile said.
"We have to look inward and reassess where we are going and what we are doing," said Apedaile, who is based in Hong Kong.
The president of the Institute of Chartered Accountants of Pakistan, Khaliq-ur-Rahman, said the scandal "shamed" everyone in the profession and made life more difficult.
"We are very seriously thinking about how to restore our image and restore our prestige in front of the general public because regulators, the shareholders, lenders are all looking at us with suspicion," said Rahman, an accountant with Grant Thornton in Karachi.
After the Enron scandal, accounting irregularities also emerged at US telecoms giant WorldCom Inc, creating even more of a public relations crisis for the industry.
Chinese Premier Zhu Rongji, in a keynote speech, said overseas accounting frauds have "thrown the accounting business into a credibility crisis" that can only be reversed if the accountants insist on being independent and fair with the numbers. Zhu did not mention any corporate names.
But Zhu said he hoped all accountants trained in China will remember the motto: "Make no false accounts."
Former US Federal Reserve Board Chairman Paul Volcker said poor accounting and lax corporate governance -- as well as "unrestrained greed" and "technical complexities" -- have shown that accountants can go bad even in developed countries with rules intended to curb abuses and keep corporations honest about their books.
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