Originally Posted by
BlueHorseShoe2000
Not even close. The Sarbanes Oxley Act (SOx) doesn't deal with accounting principles (that is covered by GAAP and IFRS). Instead, the law covers things like internal controls, responsibilities of senior management and the Board of Directors, accounting firms, etc. I think you are the first person to raise the notion that Midwest employeed questionable accounting practices to achieve their financial results. Besides, you seem to have confused the term "write-off" with delaying expenses for future periods or misclassifying them in the financial statements (such as capitalizing liabilities as in the case of Worldcom).
You are correct about accounting but SOx put teeth in it with Officers being subject to prison. I'm not implying YX was any better or worse than GAAP at the time. But things have changed a lot.
GAAP got pretty conservative with the fall of Arthur Andersen. Officers are signing off with a significant risk to their lives and livelyhood on that.
Since that time a lot of companies have adopted ERP systems which for the most part are capable of near real time numbers to (far faster than accounting departments used to) execs that would take some creative accounting to fudge. And there would be an electronic trail in the process. Changing, covering up or omitting that data would likely put SOx to the 20yr sentencing part.
ah but I regress... YX is gone and done.