Back in 2000s, the fraudulent of Arthur Andersen (Big 5 acct’g firm) and the collapse of Enron led to the lost of public’s trust against accountant, financial accounting, and CPAs. As such, a new generation of auditing began to rebuild the public’s trust. For example, the introduction of Sarbanes Oxley and PCAOB, more regulation against the auditors, more in-depth auditing procedures, and higher auditing fees. Today, we see fraudulent incident of Madoff and collapse of investment banking, investment industry. Public lose trust at the investment market; nevertheless, it will be corrected in the near future depending upon the government’s actions, and new regulation will adopt to enhance the market. What regulations do you think will/should be “PUT” upon investment industry to bring our new generation of investment market? Also, does anyone think CFA’s role will change and shine better than ever?
Hedge funds will change dramatically. 1. 1-10 will dominate. 1% of management fees. 10% of profits. 2. More regulations. 3. Less leverage. CFA won’t change. Al
SarBox was an improvement? Wow. Last time I checked, the general concensus was that SarBox was largely a gross overreaction by Congress to a single incident with dire consequences.
End of the Wall Street Ponzi scheme? Or maybe at least for a while till the next Ponzi scheme comes along in 10 years when people’s memories fade.