International Accounting in Light of Enron: Evidence from Empirical Research

Posted: 15 Apr 2005

See all articles by Mark H. Lang

Mark H. Lang

University of North Carolina at Chapel Hill

Multiple version iconThere are 2 versions of this paper


Recent accounting scandals have led some to argue that US reporting is fundamentally flawed and that other systems might be preferable. However, the arguments are often based on anecdotes and conjecture. In this paper, my goal is to bring insights from empirical research to bear on the issue of the relative effectiveness of US reporting. I argue that research evidence on cross country differences in accounting suggests that US reporting compares well with other countries' and that evidence on cross listing indicates that US accounting has a level of credibility not enjoyed by most other systems. Further, there is relatively little systematic evidence of deterioration in US accounting over time. Subject to the natural caveats with empirical research, the evidence suggests that US accounting has performed relatively well historically. While there are important lessons to be learned from experience with recent scandals, I argue that the empirical evidence supports the conclusion that changes should be incremental rather than wholesale. Further, the ongoing response to the scandals may actually strengthen the US system relative to other countries.

Keywords: International accounting, Enron, Securities regulation

JEL Classification: F30, G15, M41

Suggested Citation

Lang, Mark H., International Accounting in Light of Enron: Evidence from Empirical Research. North Carolina Journal of International Law and Commercial Regulation, Vol. 28, No. 4, pp. 953-966, 2003. Available at SSRN:

Mark H. Lang (Contact Author)

University of North Carolina at Chapel Hill ( email )

Kenan-Flagler Business School
McColl Building
Chapel Hill, NC 27599-3490
United States
919-962-1644 (Phone)
919-962-4727 (Fax)

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