Accounting Frauds - Accounting Frauds The accounting fraud...

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Accounting Frauds “The accounting fraud is a deliberate manipulation and abuse of the recording of revenue or expenses in order to achieve an operating profit of the company in order to appear better than it actually is.” The accounting fraud is a deliberate manipulation and abuse of the recording of revenue or expenses in order to achieve an operating profit of the company in order to appear better than it actually is. Some companies do things that constitute fraud are: – No list of prepaid expenses and other assets in connection –Not the classification of certain assets and liabilities. – Reduce the short and long term in one sum. With the inclusion of revenues is the most common method of accounting fraud. A company can ship its products to customers, do not ask those who know that customers return the products after the end of the year. While in the work of returns, records of the products of companies where the sales were real. Or a company may engage in channel stuffing. It offers products to distributors or end users who do not really, but business is business on the side that provide incentives and privileges, whether dealers or customers is not opposed to taking a quick delivery of products. A company can also avoid delay-recording products that were returned by customers to the recognition of these movements against the proceeds from the sale this year the other way a company undertakes, accounting fraud is a result of registration fees, not including expenses for amortization. Or a company may decide that all of its cost of sales registers of both costs of sales over a period of time. This would reduce the gross margin higher, but the inventories of the assets of the company are products that are not really in the list because they were delivered to customers. A company may choose not to take for asset losses that should be recognized as receivables write-offs, or could not write, the inventories at lower of cost or market rule. A company cannot record all the responsibilities of work, so were the estimated liability in the balance sheet of the company. Its benefit, therefore, be estimated highly enough. In other ways, Accounting scandals , or corporate accounting scandals , are political and bussiness which arise with the disclosure of misdeeds by trusted executives of large public corporations. Such misdeeds typically involve complex methods for misusing or misdirecting funds, overstating revenues, understating expenses, overstating the value of corporate assets or underreporting the existence of liabilities, sometimes with the cooperation of officials in other corporations or affiliates.
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In public companies, this type of "creative accounting" can amount to fraud and investigations are typically launched by government over sight agencies, such as the Securities and Exchange Commission (SEC) in the United States. Unfortunately, scandals are often only the 'tip of the iceberg'. They represent the visible catastrophic
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This note was uploaded on 07/28/2010 for the course ACC ACC101 taught by Professor Mrsmith during the Spring '08 term at Acton School of Business.

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Accounting Frauds - Accounting Frauds The accounting fraud...

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