There is a need for regulation of our accounting profession. We cannot afford a system, like the present one, that facilitates failure rather than success. Accounting firms have public responsibilities. We have had too many financial and accounting failures. While there are many facets of our system that need repair, the potential loss of confidence in our accounting firms and the audit process is a burden our capital markets cannot and should not bear (Harvey Pitt, President of the US SEC).

A) While the statement above was made in the context of the US, it is equally true for many other countries, including South Africa. i) Discuss and explain in detail recent or current accounting failures that have occurred in the private sector in your country (40Marks)