When I need a subroutine to modify one (or more) scalar variables I usually use a 3rd method: I send the value back in the return.

It seems that you want the subroutine to return a status. But even then couldn't you use undef as a failure signal?

unless( defined( $variable= foo( $variable))) die "horrible death: $sn
+afu::ERROR";
package snafu;
my $ERROR;
sub foo {
     # interesting things happen
     if ( $things_worked ) {
       return $baz;
     else {
       $ERROR= "horrible death";
       return undef;
     }
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I actually very rarely modify $_[0] and al. I don't like side effects and I prefer to see clearly which variables are modified by a function.