BellaOnline Forums Career Accounting Financial Statements' Fraud Concealment

Fraudster go extraordinary lengths to conceal their fraud. They become creative designing the cover-up. For example, spreading write-offs of misstatements in a company's financial statements over periods up to 10 years is designed to conceal write-offs and minimize their impact on earnings.

If a company has different geographical locations, another method is making entries designed to cover up items that could lead analysts and investors to question a company's reported results. These entries simply move dollars from one income statement category of expense to another � from the correct one to an incorrect one � with the sole purpose of disguising the true trends of a business.

Forensic accountants are expert in identifying ways of concealing fraud.

I agree. That is especially possible when no checks and balances are enforced. That is why people must take vacations and others should do their work- that is when stuff comes up to the surface.

You are correct Kasmetche.

Forcing trusted employees to take vacation and having others in charge of his or her duties is key to uncover wrongdoing.

This is an inexpensive mitigating factor that many small business should implement to minimize risks of fraud.