Accounting Scandals

Accounting scandals occur when companies manipulate their financial statements to present a misleading image of their financial health. This can involve overstating revenues, understating expenses, or hiding debt. Such practices mislead investors, regulators, and the public, often leading to significant financial losses and loss of trust. Famous examples include Enron and WorldCom, where fraudulent accounting led to bankruptcy and severe legal consequences. These scandals highlight the importance of transparency and ethical practices in accounting, as they can have far-reaching impacts on economies and individuals’ lives.