Reported accounting scandals in 2002 to date:
There is a general perception that there are other accountancy scandals waiting to be uncovered, which has contributed to the 2002 stock market downturn.
On July 9, 2002 George W. Bush, the first US President to hold an MBA, gave a speech about recent accounting scandals that have been uncovered. In spite of its stern tone, the speech did not focus on establishing new policy, but instead focused on actually enforcing current laws, which include holding CEOs and directors personally responsible for accountancy fraud.
In July, 2002, WorldCom filed for bankruptcy protection, in the largest corporate insolvency ever.
These scandals have reignited the debate over the relative merits of US GAAP, with its rules-based approach to accounting, and International Accounting Standards and UK GAAP, which favour a principles-based approach. The Financial Accounting Standards Board has announced it intends to introduce more principles-based standards. More radical means of accounting reform have been proposed but so far have very little support.