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For the purposes of this assignment, the accounting ethical breach that led to the collapse of MF Global will be analyzed.

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3. Corzine wore many hats at MF Global – he was CEO, as well as chief trader. The decision to build up the company’s BIIPS debt portfolio was taken by the chief trader (Corzine), and approved by the CEO (also Corzine)! Without effective checks in place to Given the corporate ethical breaches in recent times, assess whether or not you believe that the current business and regulatory environment is more conducive to ethical behavior. Provide support for your answer.

In the current business and regulatory environment, there are certainly greater safeguards in place in order to ensure that company officials adhere to ethical behavior. The Sarbanes Oxley Act, along with numerous other pieces of corporate governance legislations, was enacted for this very purpose. A number of external checks exist in addition to internal controls, in the form of external audits.

However, in spite of these checks and safeguards, Wall Street has been rocked by a number of scandals wherein the officers of the company were found to have brazenly betrayed the fiduciary trust placed in them by shareholders for personal monetary gain. The example of MF Global, discussed in greater detail in the following pages, is an instance wherein company officials let their avarice overcome their common sense, resulting in dire financial consequences.

Company officials are not the only ones who are guilty of dereliction of duty. External officials, including independent auditors, have also been found to be guilty of the same at times. For instance, consider the going concern declaration that every independent auditor is supposed to make after completing an audit, certifying that the firm is solvent and has sufficient funds on hand to pay its obligations. If an auditor finds evidence to the contrary, he has a professional obligation to disclose his findings...