During 2002, Enron Corporation admitted hiding large liabilities from its balance sheet. WorldCom confessed to recording expenses

Question:

During 2002, Enron admitted hiding large liabilities from its balance sheet. WorldCom confessed to recording expenses as assets. Both companies needed to improve their appearance as reported in their financial statements.
Required
1. What is the fundamental ethical issue in these situations?
2. What can happen when companies report financial data that are untrue?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...