Accounting
Scandal Updates on July
24,
2002
Bob
Jensen at Trinity
University
Bob Jensen's main document on the Enron scandal and other accounting frauds is at http://www.trinity.edu/rjensen/fraud.htm
"Energy Deals Made $200 Million In Fees for Citigroup, J.P. Morgan," by Paul Beckett and Jathon Sapsford, The Wall Street Journal, July 24, 2002 --- http://online.wsj.com/article/0,,SB1027459914213766120,00.html?mod=todays%5Fus%5Fpageone%5Fhs
WASHINGTON -- Citigroup Inc. and J.P. Morgan Chase & Co. made more than $200 million in fees for transactions that helped Enron Corp. and other energy companies boost their cash flow and hide debt, according to congressional investigators and others.
In a congressional hearing Tuesday, investigators also laid out evidence from company documents that suggested the bankers knew of Enron's aim to avoid scrutiny through the deals. Along with the banks' acknowledgment that they marketed such schemes to other energy companies, some legal specialists said the evidence raised the specter of possible criminal or civil liability for the nation's two largest financial institutions.
Both banks defended the transactions as legitimate Tuesday, often in the face of hostile questioning from the Senate Permanent Subcommittee on Investigations. The banks contend that none of the transactions broke any laws, and that it was not their job to audit how the energy company booked the transactions.
The hearing aimed to determine how much Wall Street enabled the complex arrangements that helped fuel the spectacular rise and swoon of the energy industry. As it went on, shares in both banks plunged.
In 4 p.m. New York Stock Exchange composite trading, Citigroup shares sank 15.7%, or $5.04, to $27. Its high, in September 2000 was $59. J.P. Morgan stock was off 18.1%, or $4.44, at $20.08 a share -- down from a March 2000 high of $67.
"If it looks like the banks gave companies intricate instruction on how to do all this, the banks are going to face a significant chance of being indicted," said Christopher J. Bebel, a partner with Shepherd, Smith & Bebel. Mr. Bebel is a former consultant for the Department of Justice and a former Securities and Exchange Commission investigator.
The structures the banks were promoting to Enron and energy companies involve prepaid oil and gas contracts, in which money is paid up front for future delivery of the commodity. Those are common in the industry. But energy companies employed complex circular trades among an offshore entity, the banks and themselves, enabling them to book that cash as part of their trading operations -- instead of as debt -- and also keep investors in the dark.
To help sell these financing deals, according to new documents released Tuesday, Citigroup and J.P. Morgan developed pitch books about how companies could use their services. Critics allege the strategies deceived investors by masking a company's true financial health.
One Citigroup presentation from last year, for instance, touts how using such an arrangement "eliminates the need for Capital Markets disclosure, keeping structure mechanics private" and that "ratings agencies will not view the proceeds raised ... as company debt." For its part, J.P. Morgan, in a July 1998 presentation, noted that such structures were "balance sheet 'friendly.' "
In one February 1999 e-mail disclosed Tuesday, Adam Kulick, a Citigroup vice president, told colleagues that "the client does not wish to have to explain the details of many of the assets to investors or rating agencies." The e-mail went to Citigroup's working group for the biggest of the Enron transactions, a series of deals dubbed "Yosemite." Neither bank commented on the individual documents.
Officials at ratings agencies Moody's Investors Service and Standard & Poor's said at the hearing that if they had known how Enron was boosting cash flow and hiding debt they would have given the company a much lower credit rating than the investment grade it enjoyed until just before its collapse.
In addition to Citigroup's 10 transactions with Enron through June 2001, the bank disclosed for the first time that it engaged in earlier prepaid trades involving special-purpose vehicles with other firms -- Arkla Exploration Co. in 1992 and Amerada Hess Corp. in 1993. A spokesman for Amerada Hess said all of the trades were accounted for properly. A spokeswoman for Arkla couldn't immediately comment.
Citigroup also said it had made presentations on financing arrangements similar to Yosemite to many of the best-known players in the energy business -- including Williams Cos., El Paso Corp., Reliant, Dynegy Inc., and Duke Energy. Citigroup said none of those companies took the bank up on its offer. Duke, Williams, Dynegy, Reliant and El Paso declined to comment.
J.P. Morgan said that besides Enron seven other companies used the same offshore vehicle it established, called Mahonia Ltd., or a successor. The bank named Columbia Natural Resources Inc., now part of NiSource Inc., Occidental Petroleum Co.; Ocean Energy Inc.; Santa Fe Snyder Corp., which is now part of Devon Energy Corp.; and Tom Brown Inc. Spokesmen for those companies said the transactions with J.P. Morgan were all accounted for properly.
J.P. Morgan said the widespread use of prepaid contracts bolstered the bank's contention that they were both legal and in accordance with accounting principles. "Prepaid forwards are widely used deals by a large number of companies," the bank said in a statement. "The fact that they were widespread demonstrates that several outside firms found that they were legal and appropriate."
Continued at http://online.wsj.com/article/0,,SB1027459914213766120,00.html?mod=todays%5Fus%5Fpageone%5Fhs
Bob Jensen's evolving threads on accounting trickery can be found at http://www.trinity.edu/rjensen//theory/00overview/AccountingTricks.htm
Bob Jensen's accounting theory documents are linked at http://www.trinity.edu/rjensen/theory.htm
In case some of you did not notice, President Bush was not only on the Board of Directors of Harkin Energy, he was also on its Audit Committee at the same time.
Loan
Star State? The 1989 sale of
a Harken Energy Company
subsidiary to a
related-party raises
questions about President
Bush's role as a member of
Harken's audit committee . .
. Pres. Bush was a member of
the Harken audit committee
at the time. But when
reporters asked Bush to
discuss Harken's accounting
practices, the President
dithered. Eventually, he
noted that, in
accounting,
"Things aren't always
black and white."
Ronald Fink and Marie Leone,
CFO.com, July 15,
2002 --- http://www.cfo.com/article/1,5309,7453,00.html
(The "black and white" quotation sounds like a feed to dubyaSpeak.com --- http://www.dubyaspeak.com/ This site is intended to be the most complete collection of George "Dubya" Bush quotes available anywhere on the Internet.)
Actually accountants do not wear black or white eyeshades --- they're green! And they're green because most of the auditors of large corporations have almost no experience. Those young auditors are mere puppies yapping at the accounts receivable. See "The Strategy of Low Cost Auditing using Articling Labor" in "The Transformation of the Accounting Profession: The History Behind the Big 5 Accounting Firms Diversifying into Law," by Colin Boyd, Professor of Management, University of Saskatchewan --- http://www.commerce.usask.ca/faculty/boyd/mpacc801/FinalCBAReport.htm
The sad thing is that most members of audit committees (like George Bush) are not even accountants. They, along with the boards of director members and our U.S. legislators, are the CEOs’ pet rocks.
On July 7, 2002, the day before the Senate took up the accounting reform bill, the Subcommittee on Investigations released a report finding that Enron's directors failed to perform their duties in several important respects. http://www.accountingweb.com/item/85428
The board of fallen energy giant Enron was aware of the managers' dubious financial practices and should share blame for its spectacular collapse, a US Senate subcommittee concluded in a report out Sunday --- http://www.smartpros.com/x34600.xml
"The board witnessed numerous indications of questionable practices by Enron management over several years, but chose to ignore them to the detriment of Enron shareholders, employees and business associates," said the report, the result of a six-month probe by the Permanent Subcommittee on Investigations.
The document is a resounding 61-page rejection of the efforts by Enron board members to disassociate themselves from the questionable accounting practices and financial manipulations that brought down what was once a top ten publicly-traded US corporation.
The Senate panel, led by Michigan Democrat Carl Levin, determined that "much that was wrong with Enron was known to the board, from high-risk accounting practices and inappropriate conflict of interest transactions, to extensive undisclosed off-the-books activity and excessive executive compensation."
"Overall the board received substantial information about Enron's plans and activities and explicitly authorized or allowed many of the questionable Enron strategies, policies and transactions now subject to criticism," the report concluded.
"Those red flags were not heeded," its authors, including Maine Senator Susan Collins, the subcommittee's ranking Republican, admonished.
There were six primary areas in what the report described as Enron management's duplicity in accounting that turned what was once "a well-respected and award-winning company into a disgraced and bankrupt enterprise in less than three months."
The 15-member board "failed to safeguard Enron shareholders and prevent" the company's collapse; ignored high-risk accounting practices; overlooked inappropriate conflicts of interest and "extensive undisclosed off-the-books activity".
It also did not respond to excessive compensation; and compromised its independence with financial ties between board members and executives, the report said.
For these failures, "the Enron board contributed to the company's collapse and bears a share of the responsibility for it."
The report also contradicts claims of ignorance by former Enron CEO Ken Lay -- once a close ally and contributor to President George W. Bush.
It could also compromise the influential soon-to-retire Republican Senator from Texas, Phil Gramm, who since 1989 has been a top beneficiary of Enron campaign contributions and whose wife served as a director for the energy trader.
The spectacular December 2001 collapse of the 100 billion-dollar company, which once had more than 20,000 employees, is one of the most colossal in US history.
But the blame for the debacle is misplaced, said a lawyer for the Enron directors who were not yet part of the firm's management team, in the pages of Sunday's New York Times.
"The Senate report unfairly criticizes the board for oversight failures, when what actually occurred here was that the board was misled by management and the outside auditors about these transactions," lawyer W. Neil Eggleston was quoted as saying.
So far, auditor Arthur Andersen is the only player in the scandal to be tried. It was found guilty of obstruction of justice by a Houston, Texas federal court last month.
I am impressed by Senator McCain's courage. He's a gladiator amidst the CEO lions.
Summary of Senator John McCain's Major Proposals (that industry and large accounting firms are fighting against with every weapon in their defense arsenal):
"The Free Market Needs New Rules," by Sen. John McCain, The New York Times, July 8, 2002 --- http://mccain.senate.gov/corpgovnyt.htm
In a string of corporate failures and scandals from Enron to WorldCom, we have seen the first principles of free markets - transparency and trust - fall victim to corporate opportunists exploiting a climate of lax regulation. I have long opposed unnecessary regulation of business activity, mindful that the heavy hand of government can discourage innovation. But in the current climate only a restoration of the system of checks and balances that once protected the American investor - and that has seriously deteriorated over the past 10 years - can restore the confidence that makes financial markets work.
Congress and the president must work quickly to frame new legislation and reform corporate governance and government oversight. And I would add one more suggestion. The president and Congress should ask for the resignation of Harvey Pitt, the chairman of the Securities and Exchange Commission. While Mr. Pitt may be a fine man, he has appeared slow and tepid in addressing accounting abuses, and concerns remain that he has not distanced himself enough from former clients.
The need for government action and oversight is clear. Corporations fabricated revenues, disguised expenses and established off-balance-sheet partnerships to mask liabilities and inflate profits. Executives maximized their compensation with stock option plans that burdened their companies with huge costs hidden from investors. Venerable accounting firms, having looked the other way as companies cooked the books, shredded documents to hide their misdeeds. Although American tax policy encouraged them to do so, corporations that move their legal headquarters offshore to avoid paying taxes appear conspicuously ungrateful to the country whose young men and women are risking their lives today to defend them.
Reforms must ensure a complete separation of the auditing and consulting services provided by an accounting firm; a firm that audits a company must be prohibited from providing any consulting service - ever - to that company. Legislation sponsored by Senator Paul Sarbanes would create an Accounting Oversight Board to establish and enforce the standards for audits of publicly traded companies. But this oversight board should be completely independent from the industry, financed either as part of the S.E.C. or a separate agency.
Stock options, while a legitimate and valuable form of employee compensation, must be identified as an operating expense in a public company's financial reports. Top executives should be precluded from selling their own holdings of company stock while serving in that company. Executives should be allowed to exercise their options, but their net gain after tax should be held in company stock until 90 days after they leave the company.
Executives should be required to return all compensation directly derived from proven misconduct. Also, a corporate compensation committee should be made up of members of the board who have no material relationship with the company or personal relationship with its management. Indeed, the entire board should be similarly independent, with the exception of the chief executive.
Top executives should be required to certify personally that the company's public financial reports are accurate and that all information material to the financial health of the company has been disclosed. If their certification is false, they should go to jail.
Government should remove egregious conflicts of interest in "full-service'' financial institutions. Investment services, including research, should be separated from lending, underwriting and securities trading.
Even as we take these and other necessary actions, asking for the resignation of Mr. Pitt would help show the public our seriousness. During his first 10 months as S.E.C. chairman, he did not participate in 29 of the commission's votes, most of which involved his former clients. To address corporate misconduct, he seems to prefer industry self-policing to necessary lawmaking. Government's demands for corporate accountability are only credible if government executives are held accountable as well.
What is at risk is the trust that investors, employees and all Americans have in our markets and, by extension, in the country's future. To love the free market is to loathe the scandalous behavior of those who have betrayed the values of openness that lie at the heart of a healthy and prosperous capitalist system.
Six
ways to crack down on
corporate crooks
"More Reform and Less
Hot Air," by Daniel
Eisenberg, Time, July
14, 2002 --- http://www.time.com/time/magazine/article/0,9171,1101020722-320777,00.html
1. More Orange Jumpsuits
President Bush last week called for doubling the maximum prison term for mail and wire fraud to 10 years. But the problem isn't the length of the sentence handed down for corporate malfeasance; it's winning a criminal conviction in the first place. Financial misdeeds are often difficult to explain to juries, and proving intent is even harder. More money for investigators would help, but the new $100 million that Bush pledged for the Securities and Exchange Commission is not nearly enough for the underfunded agency.There is similar posturing in Congress but also some substantive proposals. An amendment introduced by Senator Patrick Leahy of Vermont would make it a felony to defraud shareholders — making it easier to prosecute executives — and also provide more protection to whistle-blowers. Another proposed law would make CEOs liable for the accuracy of their firm's financial statements, a measure supported by nearly 90% of those surveyed in a new TIME/CNN poll.
2. Get Rid of Pet-Rock Boards
Even with the improvements of recent years, too many corporate boards of directors still serve as little more than puppets of management. Bush only briefly touched on this in his speech, calling for a majority of each board — and for all members of its audit, nominating and compensation committees — to be "truly independent" and to "ask tough questions." But this should be spelled out further. Independent should mean more than someone who doesn't work for the company; it should exclude anyone who has a consulting gig or supplier deal or who has recently left the company — as the New York Stock Exchange recently proposed.Board members also need to stop spreading themselves thin on five or 10 boards at a time. They should be subject to 10-year term limits and annual elections. The terms should not be staggered, so shareholders can throw out all board members at once if they wish. Companies should be required to give shareholders election materials about rival candidates; as it stands, small investors who want to wage upstart campaigns don't stand a chance.
To avoid getting too cozy with management, directors need to meet regularly by themselves and with auditors without any of the company's top executives present. They should appoint a lead independent director to balance the power of — or even serve as — the chairman, who these days too often happens to be the CEO. (That should not be allowed.) Finally, directors should be paid primarily with long-term grants of stock, rather than collect a check for showing up occasionally. At AutoZone, a $5 billion-a-year parts-supermarket chain, each board member must invest at least $100,000 in company stock within three years of joining.
3. Price the Options
Executive pay is out of control. the proposal from President Bush and Congress to bar company loans to executives would help address the problem. Another good idea is letting shareholders approve every grant of stock options. But it's the kind of compensation — in the form of stock options — and the perverse incentives that come with it that pose the biggest concern. Because most corporations do not deduct the cost of options from their bottom line, CEOs have no reason not to stuff their pockets with options. So far, Bush has declined to address this crucial accounting issue, and Arizona Senator John McCain's attempts to push it were blocked last week. But in an encouraging development, West Coast real estate firm AMB Property just became one of the few U.S. companies (along with Boeing and Winn-Dixie Stores) to deduct the expense.One reason options are troubling is that they encourage executives to expose the company to more risk than they would otherwise; executives have much to gain from reckless or shortsighted tactics and little to lose. Paying top executives mostly in restricted stock would force CEOs to "ride it up and down," says Charles Elson, director of the Center for Corporate Governance at the University of Delaware. And prohibiting CEOs from selling their company stock until after their tenure has ended would remove the incentive to manage earnings for the short term. McCain has called for such a restriction, which 70% of TIME/CNN poll respondents support.
4. Stop Bribing Auditors
Much of the mischief by accounting firms stems from the dual role they often play: as auditors sworn to serve shareholders and as consultants paid much more to please management. Several bills in Congress take aim at the accounting industry, promising increased oversight. None yet propose the full separation that is needed between auditing and consulting firms, as McCain called for last week, but the bills at least stipulate that public companies should not be allowed to have the same firm do both its auditing and its accounting — a proposal endorsed by more than 70% of those polled by cnn and TIME. Auditing firms — or, at the very least, their employees — should be rotated from client to client every few years. Most important, auditors should give detailed statements explaining how aggressive or conservative their client's accounting is, rather than simply signing off on it.5. End Stock Pimping
One had only to witness the grilling that Salomon Smith Barney analyst Jack Grubman endured at the congressional WorldCom hearing last week to get a sense of how low Wall Street analysts have sunk. Too many stopped providing objective stock research to investors long ago, instead spending the bulk of their time helping woo investment-banking business. New York State attorney general Eliot Spitzer has made some small progress toward cleaning up the industry: increasing disclosure of conflicts of interest and separating analysts' compensation from specific investment-banking deals. But those are half measures. The best solution would be to separate investment-banking businesses completely from research, as McCain has proposed. But the financial firms and their pet lawmakers will probably block such a reform. Still, analysts' pay should be based entirely on the performance of their stock picks, and investment banking divisions should have their own, separate army of analysts to work on deals.6. Unlock Those 401(K)S
One way to help potential victims of corporate crime is to give employees more power to diversify their 401(k) plan and not get stuck with a rotten nest egg. The Senate is considering legislation that would allow workers to sell company stock after being at a firm for three years. It would also require companies to disclose any planned insider stock sales.Continued at http://www.time.com/time/magazine/article/0,9171,1101020722-320777,00.html
Other proposed reforms are threaded at http://www.trinity.edu/rjensen/FraudProposedReforms.htm
The AccountingWeb recommends a number of books on accounting fraud --- http://www.amazon.com/exec/obidos/ASIN/0471353787/accountingweb/103-6121868-8139853
"The Truth Behind the Earnings Illusion: The profit picture has never been so distorted. The surprise? Things aren't as ugly as they look" by Justin Fox, Fortune, July 22, 2002 --- http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=208677
Question:
Where are the major
differences between book
income and taxable income
that favor booked income
reported to the investing
public?
Answer according to Justin Fox:
What the heck happened? The most obvious explanations for the disconnect are disparities in accounting for stock options and pension funds. When a company's employees exercise stock options, the gains are treated for tax purposes as an expense to the company but are completely ignored in reported earnings. And while investment gains made by a company's employee pension fund are counted in reported earnings, they don't show up in tax profits.
Analysts at Standard & Poor's are working to remove those two distortions by calculating a new "core earnings" measure for S&P 500 companies that includes options costs and excludes pension fund gains. When that exercise is completed in the coming weeks, most of the profit disconnect may disappear. Then again, maybe not. In struggling to deliver the outsized profits to which they and their investors had become accustomed in the mid-1990s, a lot more CEOs and CFOs may have bent the rules than we know about. "There was some cheating around the edges," says S&P chief economist David Wyss. "It's just not clear how big the edges are."
While conservative accounting is now back in vogue, it's impossible to say with certainty that reported earnings have returned to reality: Comparing the earnings per share of the S&P 500 with the tax profits of all American corporations, both public and private (which is what the Commerce Department reports), is too much of an apples and oranges exercise. But over the long run reported earnings and tax earnings do grow at about the same rate--just over 7% a year since 1960, according to Prudential Securities chief economist Richard Rippe, Wall Street's most devoted student of the Commerce Department profit numbers. So the fact that Commerce says after-tax profits came in at an annualized rate of $615 billion in the first quarter--a record-setting pace if it holds up for the full year--ought to be at least a little reassuring to investors. "I do believe the hints of recovery that we're seeing in tax profits will continue," Rippe says.
That does not mean we're due for another profit boom. Declining interest rates were the biggest reason profits rose so fast in the 1990s, says S&P's Wyss. Rates simply don't have that far to fall now. So even when investors start believing again what companies say about their earnings, they may still be shocked at how slowly those earnings are growing.
Continued at http://www.fortune.com/indexw.jhtml?channel=artcol.jhtml&doc_id=208677
Reply by Bob Jensen:
For a technical explanation of the stock option accounting alluded to in the above quotation, go to one of my student examinations at http://www.cs.trinity.edu/~rjensen/Exams/5341sp02/exam02/Exam02VersionATeachingNotes.htm
The exam02.xls Excel workbook answers can be downloaded from http://www.cs.trinity.edu/~rjensen/Exams/5341sp02/exam02/
The S&P revised GAAP core earnings model alluded to in the above quotation can be examined in greater detail at http://www.standardandpoors.com/Forum/MarketAnalysis/coreEarnings/index.html
The pause that refreshes just got a bit more refreshing - Coca-Cola Co. announced Sunday it will lead the corporate pack by treating future stock option grants as employee compensation. http://www.accountingweb.com/item/86333
Question:
Where are the major
differences between book
income and economic income
that understate book income
reported to the investing
public?
Answer:
This question is too complex
to even scratch the surface
in a short paragraph.
One of the main bones of
contention between the FASB
and technology companies is
FAS 2 that requires the
expensing of both research
and development
(R&D) even though
it is virtually certain that
a great deal of the outlays
for these items will have
economic benefit in future
years. The FASB
contends that the
identification of which
projects, what future
periods, and the amount of
the estimated benefits per
period are too uncertain and
subject to a high degree of
accounting manipulation
(book cooking) if such
current expenditures are
allowed to be capitalized
rather than expensed.
Other bones of contention
concern expenditures for
building up the goodwill,
reputation, and training
"assets" of
companies. The FASB
requires that these be
expensed rather than
capitalized except in the
case of an acquisition of an
entire company at a price
that exceeds the value of
tangible assets less current
market value of debt.
In summary, many firms have
argued for "pro
forma" earnings
reporting such that
companies can make a case
that huge expense reporting
required by the FASB and
GAAP can be adjusted for
better matching of future
revenues with past
expenditures.
You can read more about these problems in the following two documents:
Accounting Theory --- http://www.trinity.edu/rjensen/theory.htm
State of the Profession of Accountancy --- http://www.trinity.edu/rjensen/FraudConclusion.htm
More on Rotten to the Core
The enormous scandals and moral hazards of security analysts having to avoid sell recommendations of investments that they know their clients should sell or not buy are discussed in greater detail in my "Rotten to the Core" module at http://www.trinity.edu/rjensen/fraud.htm#Cleland
One of the enormous problems faced by analysts is that many companies will exclude them from information sources if they dare say bad things about those companies. This continues to be reflected in the sad outcomes in the far right column of the table below.
I added the following reference and table to http://www.trinity.edu/rjensen/fraud.htm#Cleland :
"Should Your Trust Wall Street's
New Ratings?
Even in the Bear Market A "Sell" Remains a Rarity But Better Guidance
id Coming"
by Jeff D. Opdyke, The Wall Street Journal, July 17, 2002, Page D1
| Morgan Stanley (March 2002) | New Ratings: Overweight Neutral Underweight | Percentage of Current "Sell" Ratings: 20.90% |
| Merrill Lynch (September) | New Ratings: Buy Neutral Sell | Percentage of Current "Sell" Ratings: 05.80% |
| Prudential (May 2001) | New Ratings: Buy Neutral Sell | Percentage of Current "Sell" Ratings: 03.50% |
| Goldman Sachs (Fourth Quarter) | New Ratings: Outperform In-line Underperform | Percentage of Current "Sell" Ratings: 01.50% |
| Lehman Brothers (Aug. 1) | New Ratings: Overweight =weight Underweight | Percentage of Current "Sell" Ratings: 01.00% |
| J.P. Morgan Chase (August) | New Ratings: Overweight Neutral Underweight | Percentage of Current "Sell" Ratings: 00.90% |
| Credit Suisse First Boston (September) | New Ratings: Outperform In-line Underperform | Percentage of Current "Sell" Ratings: 00.40% |
"Channel stuffing" refers to the practice of building inventories in distribution channels. On July 11, 2002 Bristol-Myers Squibb, one of the world's largest pharmaceutical companies, confirmed that the Securities and Exchange Commission (SEC) has launched an "informal inquiry" into its sales practices. http://www.accountingweb.com/item/85930
Channel stuffing was (is?) common in the tobacco industry where companies load up sales revenues on deliveries that they know they will have to take back after the freshness dates on packages expire. More cartons were (are?) sent to customers than can ever be sold before expiration dates.
You can read about more revenue reporting tricks at http://www.trinity.edu/rjensen/ecommerce/eitf01.htm
What are colleges doing in the wake of the accounting and corporate scandals?
"Is Education the Answer on Ethics? Our recent article on where business morality fits in B-school curriculums drew a wide variety of responses, sampled here," Business Week, July 8, 2002 --- http://www.businessweek.com/bschools/content/jul2002/bs2002078_9726.htm
A number of B-schools let us know how much they've been doing to turn out MBAs with strong ethics. At the same time, readers from the U.S. and abroad weighed in demanding more attention to business ethics as a discipline. Of course, that sentiment wasn't unanimous: Some readers felt that if B-schools emphasize ethics more in their curriculums they'll only create ghettoized courses fated to fal