Enron of Saudi Arabia: Corporate Accounting and Auditing Failures

Zerban, Ayman

doi:10.4236/ojacct.2018.71001

Cited by 8 publications

(12 citation statements)

References 8 publications

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“…For example, in 2014, an accounting scandal was occurred in Saudi Arabia. MMG (Mohammad Al Mojil Group) share price was dropped from 20 dollars to 30 cent in a short time period (Zerban, 2017;Zureigat, 2014), which was audited by Deloitte. Consequently, in June 2015, Deloitte's unit in Saudi Arabia has been banned from doing auditing work in the country for the next two years (Peterson, 2017;Zerban, 2017).…”

Section: The Revelation Of Accounting Irregularities That Taken Placementioning

confidence: 99%

“…MMG (Mohammad Al Mojil Group) share price was dropped from 20 dollars to 30 cent in a short time period (Zerban, 2017;Zureigat, 2014), which was audited by Deloitte. Consequently, in June 2015, Deloitte's unit in Saudi Arabia has been banned from doing auditing work in the country for the next two years (Peterson, 2017;Zerban, 2017). The ban follows a letter sent by the Capital Markets Authority (CMA) to companies and entities that its licenses advising them not to use Deloitte's audit services from June 2015.…”

Section: The Revelation Of Accounting Irregularities That Taken Placementioning

confidence: 99%

“…Furthermore, the revelation of accounting irregularities that have taken place in MENA were linked to Big 4 audit firms. For example, MMG (Zerban, 2017; Zureigat, 2015) was audited by Deloitte. PWC was also auditing Mobily, the listed telephony provider in Saudi Arabia, which was another objective of the investigation after profit cuts.…”

Section: Research Questions and Hypothesis Developmentmentioning

confidence: 99%

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Auditors’ ethical reasoning in developing countries: the case of Egypt

Abdelhak¹,

Elamer²,

AlHares³

et al. 2019

IJOES

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Purpose The purpose of this study is to investigate Egyptian auditors’ ethical reasoning, to understand whether auditors’ ethical reasoning is influenced by audit firm size and/or auditor’s position. Design/methodology/approach This paper draws on 178 questionnaires that include six different ethical scenarios. This paper also uses the accounting ethical dilemma instrument that is developed by Thorne (2000) to measure the ethical reasoning of Egyptian auditors. Findings The findings are threefold. First, this study finds that the general level of deliberative ethical reasoning of auditors working in the Central Auditing Organization (CAO) and small firms are categorized in the post-conventional level, while auditors working in big and medium firms are categorized in conventional level. Second, the result suggests that there is a negative relationship between ethical reasoning and audit firm size in Egypt. Finally, the results show that ethical reasoning levels decrease when the position of auditors increase except for auditors working in CAO. Originality/value This study adds to the scarce literature in developing countries that measure auditors’ ethical reasoning. The findings suggest that auditors’ ethical reasoning depends on auditor’s firm size and the position the auditor holds within the firm. These findings will aid policymakers and regulators, especially in developing countries, to avoid any potential risk regarding professional misconduct and in evaluating the adequacy of the current code of ethics.

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Section: The Revelation Of Accounting Irregularities That Taken Placementioning

confidence: 99%

Section: The Revelation Of Accounting Irregularities That Taken Placementioning

confidence: 99%

Section: Research Questions and Hypothesis Developmentmentioning

confidence: 99%

See 1 more Smart Citation

Auditors’ ethical reasoning in developing countries: the case of Egypt

Abdelhak¹,

Elamer²,

AlHares³

et al. 2019

IJOES

View full text Add to dashboard Cite

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“…It has gained the number one priority and support of the media and civil society. Strong leadership coupled with support from all sectors of society would ensure the success of Saudi Arabia's anti-corruption plans, strategies, and measures [36].…”

Section: Anti-corruption Drivementioning

confidence: 99%

An Evaluation of the Anti-Fraud Regime in Saudi Arabia from the Islamic Shariah Perspective

Ahmed¹

2021

UJBM

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The purpose of this article was to look into Saudi anti-fraud legislation and regulations in order to see how consistent the Kingdom's legal system, which is predominantly found on Islamic principles, is with a wide range of criminal and economic infractions. The main laws relating to fraud were described, and numerous types of fraud were examined, in order to attain this purpose. The discourse also necessitated an examination of the Islamic perspective on deception and fraud. The analysis revealed that Shariah law, which is concerned with property protection, incriminates and punishes individuals who obtain wealth by illegal methods, the nature of the sanctions, however, is left to the discretion of rulers and judges. Based on this, Saudi legislators have enacted a set of anti-fraud measures. These laws were examined to see how well they addressed economic crimes in the Kingdom. Anti-fraud legislation establishes a legal and regulatory framework compatible with Islamic Shariah for dealing with fraud and economic crimes, with the goal of protecting the public interest, maintaining integrity, and regulating the Kingdom's economy. The primary goal of this study is to explore the challenges and risks associated with enforcing anti-fraud laws in the context of Islamic justice principles. In this study, a descriptive research design was adopted. The key objective of this study is to determine the nature of the problem and analyze the evidence collected. Because of the lack of secondary data and the rigorous restrictions governing the reporting of fraud incidents in Saudi Arabian financial institutions. The study's hypotheses could not be tested substantively because all assumptions concerning the research findings are far-fetched.

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“…Similar recent corporate failures in South Africa include Eskom, Tongaat, Steinhoff and Venda Building Society (VBS) Bank, where the auditors' conduct and the governance practices of the auditing firms were called into question (Burkhard, 2020;Lungisa, 2017; Open Secrets, 2020;Pilling, 2017). From the literature, it is evident that sound corporate governance oversight and practices--not just within organisations but also within their auditing firms-can prevent such corporate scandals, thereby increasing the level of trust among society, businesses and their stakeholders (Zerban, 2018). Yet, corporate and auditing…”

mentioning

confidence: 99%

Corporate Governance Practices in Large and Medium-Sized Auditing Firms in South Africa

Smith

Marx

2022

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South African corporate failures and audit failures, including those of VBS Bank, Tongaat, Steinhoff and KPMG, have exposed vulnerabilities in audit quality and the role of governance failures in auditing firms. In auditing firms, good corporate governance principles are not always followed. Additionally, South Africa does not have a corporate governance code that governs auditing firms, nor is there a sector supplement to the King IV Report on Corporate Governance that applies to other industries. To identify areas for improvement in South Africa, this study aimed to ascertain the current corporate governance practices in South African auditing firms and compare them to the United Kingdom (UK) Audit Firm Governance Code. A structured questionnaire based on the UK Audit Firm Governance Code was used to collect qualitative data. Nine large and medium-sized South African auditing firms with 20 or more auditing partners made up the population. The literature study emphasised the value of good corporate governance in auditing firms, as well as the difficulties these firms encounter with corporate governance. The review also emphasised the absence of codes and standards regulating corporate governance in auditing firms. The empirical results highlighted the resultant inconsistencies in corporate governance application in South African auditing firms. Areas requiring improvement were identified in the study.

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Enron of Saudi Arabia: Corporate Accounting and Auditing Failures

Cited by 8 publications

References 8 publications

Auditors’ ethical reasoning in developing countries: the case of Egypt

Auditors’ ethical reasoning in developing countries: the case of Egypt

An Evaluation of the Anti-Fraud Regime in Saudi Arabia from the Islamic Shariah Perspective

Corporate Governance Practices in Large and Medium-Sized Auditing Firms in South Africa

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