Healing Thyself

Following the Enron, WorldCom, and other corporate manipulations that fell under the umbrella of “accounting scandals,” business schools reported a sudden upsurge in accounting course enrollments. The explosion of interest has never been fully explained. But based on my moonlighting experience teaching at a major B-school, I concluded, cynically, that the kids wanted an early primer in how to jerk the figures around the right way. Accounting is not supposed to be fun, and few accountants make it to the top ranks of Corporate America. CEOs and COOs are more likely to come up from the operating, sales, financial, and other big, bad, muscle-flexing functions where “don’t bother me with the figures” mentalities seem to prevail. Those attitudes may have to change – and fast Every time I do a story on m&a accounting changes or controversies, it strikes me that the ramifications go well beyond the P&L statements and balance sheets, and include sales recognition, profits, company values, and, ultimately, stock prices. That should send a message to corporate executives that they are not remote from accounting issues. But if that’s not strong enough, think of how Sarbanes-Oxley requires CEOs and CFOs to certify the figures they report – meaning that they had better know how the numbers were born and what systems were used to produce them. When you’re an executive whos under the gun like that, it might behoove you to follow the lead of the college kids and take some accounting courses to learn just what you’re getting yourself into. Your advisers can take you only so far. For complete comfort, your own expertise has to kick in at some point. Heal thyself. Martin Sikora Editor Copyright 2004 Thomson Media Inc. All Rights Reserved. http://www.thomsonmedia.com http://www.majournal.com