Five degrees of reformation

Matthew Lynn

Three European accounts scandals in less than a year indicate something is wrong with the system. Here are five changes we could think about

It's time to stop feeling smug. When it comes to accounting scandals, Europe can compete with the rest of the world. After Enron Corp and WorldCom Inc in the US, Europeans could sit back and reflect that misleading accounts were an issue for Americans only. Not anymore. There are three reasons: Royal Ahold, Parmalat Finanziaria and now Adecco. At each, a big company has put out accounts that told their shareholders little about what was actually happening in the business. Take Ahold. In February last year, the Dutch supermarket group reported it had overstated earnings by at least $500m i...