The researcher analysed selected U.S.court cases of financial statement fraud from the past twenty years and concluded:(1)U.S.laws used to prosecute financial statement fraudsters include the Securities Act,Securities...The researcher analysed selected U.S.court cases of financial statement fraud from the past twenty years and concluded:(1)U.S.laws used to prosecute financial statement fraudsters include the Securities Act,Securities Exchange Act,S.E.C.Rule 10b-5,Investment Advisers Act,Private Securities Litigation Reform Act,and the Sarbanes-Oxley Act;(2)financial statement fraud schemes included use of unconsolidated special-purpose entities to conceal debt,improper revenue recognition in leasing of bandwidth in the telecom industry,improper accounting for goodwill in a merger,failure to write off a large amount of bad receivables,excessive recognition of revenue in bundled leases in the photocopier industry,use of loss contingency reserves to inflate current income,use of fictitious revenue to overstate earnings,and capitalising a project’s operating expenses to hide cost overruns;(3)to be liable for financial statement fraud,a corporate officer must have knowledge;and(4)employees discharged for reporting financial statement fraud may sue under the Sarbanes-Oxley Act.展开更多
文摘The researcher analysed selected U.S.court cases of financial statement fraud from the past twenty years and concluded:(1)U.S.laws used to prosecute financial statement fraudsters include the Securities Act,Securities Exchange Act,S.E.C.Rule 10b-5,Investment Advisers Act,Private Securities Litigation Reform Act,and the Sarbanes-Oxley Act;(2)financial statement fraud schemes included use of unconsolidated special-purpose entities to conceal debt,improper revenue recognition in leasing of bandwidth in the telecom industry,improper accounting for goodwill in a merger,failure to write off a large amount of bad receivables,excessive recognition of revenue in bundled leases in the photocopier industry,use of loss contingency reserves to inflate current income,use of fictitious revenue to overstate earnings,and capitalising a project’s operating expenses to hide cost overruns;(3)to be liable for financial statement fraud,a corporate officer must have knowledge;and(4)employees discharged for reporting financial statement fraud may sue under the Sarbanes-Oxley Act.
