How Companies Lie

Corporate strategists A. Larry Elliott and Richard Schroth discussed their new book, How Companies Lie: Why Enron is Just the Tip of the Iceberg, published by Crown Business. The book explains the accounting practices that enable companies to mislead investors and shows investors what to watch for in evaluating companies. The authors illustrate their points by using the examples of Enron, Sunbeam, Global Crossing, Waste Management, and other companies. The book proposes new legislation to create a federal insurance fund to reimburse investors who lose money as a result of a company’s stock manipulation and advocates an audit tax, which would fund the transfer of corporate auditing to a neutral, SEC-administered process. After their presentation, the authors answered questions from the audience. close