Accounting Scandals article

If you open Wikipedia's page Accounting Scandals and read it, you will feel wonder to see large number of accounting scandals which were done by Accountants and Auditors. In these scandals, main aim was to get money of company on the basis of cheating it and for this accountant uses accounting technique either to show understating expenses or overstating the value of corporate assets or underreporting the existence of liabilities. Accounting is science and it can be also used for wrong purposes also. Following are main ways to do accounting scandals.

1.# Company's profitability appear temporarily poorer

Why do cheaters do this? Because with they can save tax and this money goes to accountant's personal pocket or other group of cheaters.

2.# window dress

Why do cheaters do this? Because, with this, they can get loan more fastly and this loan is misused by cheaters.


3.# A reduced share price makes a company an easier takeover target.

This is also cheating. Main aim is to takeover the company.

4.# Cheating in non-profit organization

Main aim of this cheating to collect donation and misuse this for personal benefit.

5.# Financial misstatements

By this, cheater can misdirect funds.

6.# Falsifying financial results

Main aim is to collect cash and other assets for personal use and owner will not realize what has been happened.

7.# Inflated sales

It is also cheating to other supplier and customers and owner may include in this cheating.

8.# Misleading accounting practices

All accounting practices which is against GAAP

9.# Illegal payments

The payment which is illegal under rule. This will be accounting scandal.

10.# Inflating promotional allowances

To show more promotional allowances than what is actual for getting more money from owner and misuse it.