13
Financial Shenanigans
CHAPTER OBJECTIVE
This chapter will help the readers to:
- Understand the regulatory framework in place to ensure that the financial statements are reliable.
- Appreciate the accounting areas where managerial discretion is available.
- Develop familiarity with the common areas of creative accounting.
- Dissect some of the (in)famous accounting scams of recent times.
- Appreciate the need for ethics in accounting.
As discussed in Chapter 1, the accounting information is prepared by the management and used by a large number of stakeholders for taking economic decisions. The end result of the accounting cycle, that is, the three key financial statements—the balance sheet, the profit and loss account, and the cash flow statement—convey ...
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