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Hi, yes, this is largely how audit firms work. If they find a problem, they will not be hired next year. That said - don’t despair! The purpose is NOT to catch
by curiousllama 6y ago
Hi, yes, this is largely how audit firms work. If they find a problem, they will not be hired next year.
That said - don’t despair! The purpose is NOT to catch purposefully-fraudulent CFOs. That’s the SEC’s job. It’s much more of a forcing mechanism for otherwise-honest CFOs: they know they have to justify what they’re doing somehow, and the auditor knows that if something will inevitably blow up anyway, they can’t sign off. So it just arrests the slippery slope when honest mistakes are made.
- cutemonster 6y ago> arrests the slippery slope What does that mean? Not a native speaker, dictionary not so helpful
- ben_w 6y ago“Slippery slope” is an (often misused) metaphor; the bottom of the slope is generic badness, the top is a good place to be, and the slope is slippery because if you start sliding down it can be very difficult to stop. While “arrest” normally means a police officer putting someone in handcuffs, it is derived from derived from the French word “arrêt“ meaning 'to stop or stay', and can still be used in that sense. Thus, “arrest the slippery slope” means “prevent bad behaviour”.
- cutemonster 6y agoThanks! Interesting to hear about the origins of the words