You are absolutely correct. My guess though is that the move from balance sheet auditing to systems testing was primarily motivated by cost savings. The biggest problem with large public accounting firms is that along time ago they decided to compete on price rather than on quality. This certainly is not news, especially to attorneys that deal with corporate governance matters. So why has nothing been done about it?
This doesn't explain, however, some of the calculated moves the humans involved made insofar as where to place what 'debt' where - nor to explain the rationale made by the humans at Enron to enter or angage in 'new' markets such telecommunications (which, in case you haven't noticed, has taken a downturn this last year) ...
Nor does 'system testing' you allude to substitute for actual balance sheet auditing. I plain, flat, straight away don't see how you can make that statement.