A qualitative comparative study of the Jenkins' Committee recommendations, SOX and the Enhanced Business Reporting Consortium (EBRC) proposed framework in relation to corporate malfeasance

This study examines the recommendations for business reporting from the AICPA Special Committee on Financial Reporting (the Jenkins' Committee) 1 from a historical perspective and provides a historical overview of business reporting drivers. It includes a comparative analysis of the recommendations of the Jenkins' Committee (AICPA 1994), the 2002 Sarbanes-Oxley (SOX) legislation and the October 2005 business reporting framework proposed by the Enhanced Business Reporting Consortium. The Jenkins recommendations and SOX requirements both include, in addition to other items, more disclosure, more board independence and less related party transactions between board members, officers and the corporation. This research seeks to examine the historical value of these recommendation/requirements' impact on corporate malfeasance.; In addition, this research project explores the types of accounting malfeasance and the financial and market dollar impact ({dollar}140 and {dollar}857 billion respectively) of 100 companies with publicly announced malfeasance to determine if there was a link between the accounting malfeasance and the Jenkins' Committee Recommendations. The results of the exploratory study supports previous studies which found that revenue was the most common area of corporate malfeasance and actual theft was the least. The exploratory study was followed with an empirical examination of malfeasance using internal and external monitoring characteristics by matching the malfeasance companies with non-malfeasance companies. The results of the empirical study did not find any significant differences in the monitoring characteristics of malfeasance as compared to non-malfeasance companies.; The research contributes to the body of contemporary accounting literature by providing a historical perspective on current business reporting drivers, a dollar measurement of the accounting and related market impact for malfeasance companies. In addition, this systematic investigation provides results indicating that the difference tested, in corporate governance characteristics between malfeasance and non-malfeasance companies may not be as significant as deemed in previous studies due to the changing board of director and committee requirements by the SEC and other bodies.; 1The AICPA Special Committee on Financial Reporting was chaired by Edmund L. Jenkins, then a partner in Arthur Andersen. The Committee was established in 1991 and after in-depth study and analysis it issued its final report in 1994.