For decades, auditors have enjoyed self-regulation. This has led to senior accountants, mainly from PricewaterhouseCoopers and KPMG, assuming rule-making status. Many argue that this apparent conflict of interest has led to auditors skilfully deflecting blame for failing to spot glaring black holes or fraud at a range of institutions from Enron to Madoff and the failed banks.
UK forensic accountant Richard Murphy says: "The fundamental question is how accountants got away with changing rules of accountancy, which state they don't have to assess the valuation of assets underlying the assets on a balance sheet. How did they get away with changing the audit rules?"
The Observer begins to ask the over due question - why have the auditors had a 'good recession' when they so obviously contributed so seriously to the misinformation and opacity that helped cause it.
It's time they were called to account - and made to both pay and reform.
Agree with all of this but I would also add that the accounting standard-setters acquiesced at all times with “off-balance sheet finance”,whereby anything that the directors did not want to show the world was “shoved under the carpet”
In every financial crisis,whether limited to a single entity (Eg Enron) or on a more widespread basis this ugly creature has reared its head
All of these people have a hell of a lot of questions to answer