Paper Title :The Role of Accounting During the 2008 Financial Crisis

Author :Mohammed Aljohani

Article Citation :Mohammed Aljohani , (2018 ) " The Role of Accounting During the 2008 Financial Crisis " , International Journal of Management and Applied Science (IJMAS) , pp. 30-33, Volume-4,Issue-5

Abstract : In this paper attention is paid to various aspects that regard accounting profession as a factor that contributed to the occurrence of the 2008 financial crisis. The crisis was majorly said to be contributed by the accounting standards that tend to be not all inclusive. Those who are charged with the responsibility of implementing the accounting standards are also brought into light in the paper. In this paper, irresponsible managers who conspire with accounting professions to alter accounting data are discussed. The paper brings the argument that the accounting professions are the ones that failed in detecting and preventing the financial crisis. Three companies that were majorly hit by the crisis and some which were least hit are discussed. By discussing these companies the role of accounting profession emerges where those that did use the accounting skills during the crisis, their companies were not spared by the crisis and were brought out of business. Those that their management were conversant with accounting and applied the accounting standard appropriately were able to survive the crisis although they also felt its effect. The paper concludes that it is indeed very true that accounting profession had a great role in detecting and preventing the financial crisis. The accounting professions that had this mandate were managers, auditors and economic valuers.

Type : Research paper

Published : Volume-4,Issue-5

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