New Technology Can Help Avoid a Second Enron

6 Pages Posted: 2 Mar 2004

Abstract

If Enron had filed in XBRL, its reported revenues, cash flows from operations, and profits would have been compared against industry standards. Its growth rate and the growth rate of its purported cash flows from operations would have been so far above industry norms that it would have been flagged for an SEC staff review. It looked too good to be true, and an examination by the SEC's Corporate Finance Department would have showed that it was too good to be true.

Keywords: SEC, corporate finance, XBRL, Extensible Business Reporting Language, Enron, information, information age, corporate monitors, Transparent Reporting Using Standardized Terminology, TRUST, review, GAAP accounting, SEC reporting

JEL Classification: G18, D80, M20, M41

Suggested Citation

McNamar, R.T., New Technology Can Help Avoid a Second Enron. Available at SSRN: https://ssrn.com/abstract=511442

R.T. McNamar (Contact Author)

Cato Institute ( email )

1000 Massachusetts Avenue, N.W.
Washington, DC 20001-5403
United States

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