An accounting scandal occurs when a company or organization manipulates its financial statements to present a misleading picture of its financial health. This can involve practices like inflating revenues, hiding debts, or misrepresenting assets. Such actions can lead to significant legal consequences, loss of investor trust, and damage to the company's reputation. One of the most notable examples of an accounting scandal is the case of Enron, which used complex accounting techniques to hide its financial troubles. When the truth emerged, it led to the company's bankruptcy in 2001 and prompted widespread reforms in accounting regulations, including the introduction of the Sarbanes-Oxley Act.