Financial statement fraud

[Starmix]

Is there a financial statement fraud? The answer is yes. Is this punishable by law? The answer is the same, Yes. If you are operating a business big or small, avoid this kind of fraud. You have to declare your financial statement religiously and faithfully because if caught, you will land in jail. This fraud refers to lies, not declaring the real financial statement of your business, and the reason behind it is to skip taxes. This fraud involves fudging or tampering with the real figures like sales, revenues, assets, and liabilities. Another reason why they are doing this is to dupe investors or the public by manipulating stock or increase of bonuses. It is considered a rare fraud but once having this, the damages will be like crazy, uncontrollable.

But there is a way to avoid this kind of fraud by delegating different accounting functions to different workers in your business or companies. You need to examine it carefully, and closely examine the financial statements if there are inconsistencies or inaccurate information before publishing the financial statement. In the Philippines, the penalties are imprisonment of four to 12 years, depending on the manner of commission, and a fine of at least three times the value of the fraud. What about in your country, what is the penalty?

 

[Shavkat]

I agree that financial fraud needs to take it seriously. Although we need to choose the best accountants to handle this. If we avail the service of these people, we expect that they do right thing.

 

[cherry123]

it is good that thos fraud is punishable a lot of business owners do tell lies and refused to declare the real financial statement of their businesses to evade taxes payment

 

[uptrendfinancialsignal]

it is good that thos fraud is punishable a lot of business owners do tell lies and refused to declare the real financial statement of their businesses to evade taxes payment

It is important to declare your financial statement because it's one of those things that will attract clients.

 

[Starmix]

Financial statement fraud is done by culprits in a broad daylight. If the accounting statement reaches to the office of the Bureau of Internal Revenue the company owner will be investigated. And if it's learned the accountant is doing such fraud unless conspiring with the manager they may be sanctioned by court.

 

[Suba]

Fraud means that a financial statement is intentionally made incorrectly by a business person for personal gain. Currently, any form of fraud will be quickly discovered after the financial statements are published, especially by investors, tax offices, etc. because there will be discrepancies with reality. for example in the income statement there is a big profit but the shareholders do not get dividends.

 

[Starmix]

Fraud means that a financial statement is intentionally made incorrectly by a business person for personal gain. Currently, any form of fraud will be quickly discovered after the financial statements are published, especially by investors, tax offices, etc. because there will be discrepancies with reality. for example in the income statement there is a big profit but the shareholders do not get dividends.

That will be the scenario if the share holders for example do not receive their dividends. There is something wrong on going and the accounting department will be investigated. That fraud is indeed intentional for personal gain.

 

[Suba]

Financial statement fraud will occur anywhere, but sooner or later it will be known by the authorities (the government) or the stock exchange. So that the company will certainly be subject to penalties and fines, and for the accounting firm the license will be frozen or revoked. Also the name of the accounting firm is not trusted by people.

 

[hastral45]

The habit of committing financial fraud is normal practice in Nigeria. Most conglomerate companies do not declare their true financial statements in order to have low taxes rates. They do this successfully with connivance with government tax officials.

 

[Starmix]

The reputation of one's business and the fraudulent activity will be sooner or later exposed. It brings shame to all workers and especially the families of the involved cheaters.

 

[Suba]

The habit of committing financial fraud is normal practice in Nigeria. Most conglomerate companies do not declare their true financial statements in order to have low taxes rates. They do this successfully with connivance with government tax officials.

This means that fraud is carried out because there is an opportunity to work with rogue tax office employees, so that the income tax charged will be low, in cases like this it will usually take a long time to be uncovered, unless the company issues shares, (issuers). Because the stock market will automatically disclose fraud.

 

[Springtime]

It is a legal offence here to present false financial statements which mislead the shareholders and the public. It is considered as a financial crime. The directors are liable to a heavy fine or even imprisonment.

 

[hastral45]

It is a legal offence here to present false financial statements which mislead the shareholders and the public. It is considered as a financial crime. The directors are liable to a heavy fine or even imprisonment.

Hmn, this is a big offense. But surprisingly, it has become normal practice. When they are selling shares of companies to the public, false financial statements would be produced as evidence of good standing of the companies. It is later after purchasing the shares true revelation about the financial status would come out.

 

[uptrendfinancialsignal]

There are huge number of financial statement fraud that is recorded everywhere.

 

[Heatman]

I believe that most people that are running shady and illegal businesses are always fond of publishing a fake financial statement because they cannot be able to provide the real amount of cash inflow that they are making from their illegitimate businesses.

 

[hastral45]

It is a grievous crime for any institutions to commit financial fraud. In Nigeria, just as there are special courts established for the purpose of trying financial crime cases, and another agency called EFCC for the investigation and trying financial crime cases, yet the rate of financial crimes is not reducing.

 

[uptrendfinancialsignal]

I believe that most people that are running shady and illegal businesses are always fond of publishing a fake financial statement because they cannot be able to provide the real amount of cash inflow that they are making from their illegitimate businesses.

They would publish fake statement of account so that it will shield their illicit activities.

 

[Suba]

Hmn, this is a big offense. But surprisingly, it has become normal practice. When they are selling shares of companies to the public, false financial statements would be produced as evidence of good standing of the companies. It is later after purchasing the shares true revelation about the financial status would come out.

You are right, issuers who issue fake financial statements will quickly be exposed, especially by the securities market and shareholders, this fraud will certainly continue in court. So whatever the form of financial statement fraud will be easily known by the public.

 

[eldavis]

I have heard about cases like this before though. Some companies have complained about it before but i have not experienced this personally and i really hope i do not have to experience it.

 

[Starmix]

Financial statement fraud is detrimental to the business. The amount of purchase may be jacked up for the benefits of the other party. The other way is to decrease the issuance of the total liabilities to pay lesser taxes. It's manipulative fraud.