Financial Reporting As a Factor of Corporate Crime

Corporate crime is a phenomenon that marked the XX century. The first half was marked with two major world economic crises (The Great Depression) and the second with an increasing number of massive corporate scandals.Corporate crime stems from business activities and although there were financial scandals in previous centuries, corporate crime was in full swing in the last two decades. Modern business has significantly dematerialized and transformed into virtual reality, which on one hand represents a significant breakthrough, but on the other hand it opens a wide space and offers modalities for perpetrating crimes in the field of finance. Nevertheless, regardless of the conditions of modern business, the basic reason for corporate crime derives from human greed, namely, the wish to acquire resources which are limited by nature. What is significant is the fact that this type of fraud is spreading, and as a consequence there has emerged a need to study this concept from the scientific and professional perspectives, so as to find a solution and enable corporate crime prevention. This paper will analyze corporate crime, errors, victims and financial statements as possible key points in meaning corporate crime. So, to point the corporate crime we also point out need of knowledge of accounting and rules for making financial statements, sufficient experience in coping with corporate crime incidents, the protection of interests in business is still not perfectly clear, starting from the fact that it is hard for creditors to protect their interest and collect their receivables to the fact that the interest of a certain party prevails over the common interest, management or owners, often establish a big number of small companies, directly or indirectly connected and thus break their business into pieces with an aim to avoid the audit of financial reports and overall fraudulent financial statements cause substantial damage to economy. Further will be offered the essentials that fraud examiners who investigate should be good and experienced experts in this field who will recognize the symptoms of modified financial statements