The empirical evidence suggests that firms overpay for fraud liability and overspend on internal compliance mechanisms (which are not very effective at preventing fraud). Yet, insiders who commit fraud are rarely sanctioned for their wrongdoing, which produces moral hazard and individual...

Attempting to satisfy their political masters in a target-driven culture, Soviet managers had to optimize on many margins simultaneously. One of these was the margin of truthfulness. False accounting for the value of production was apparently widespread in some branches of the economy and at...

This paper examines the largest corporate fraud in India at Satyam Computer Services Ltd. This fiasco occurred in January 2009 when Mr. Ramalinga Raju, the Chairman, confessed to an extensive accounting fraud that was ongoing for at least seven years. Since then, a large number of articles have...

Accounting statements keep by the key source for processing financial analyses of enterprises. The healthy enterprise should have been able to load the object of her activities, to reach constantly required measurement estimation of the contribution of capital for investors, with thinking about...

In this paper we look at business ethics from a deontological perspective. We address the theory of ethical decision-making and deontological ethics for business executives and explore the concept of “moral dutyâ€\x9D as transcending mere gain and profit maximization. Two real-world...

We analyze corporate fraud in a model where managers have superior information but, due to private benefits from empire building, are biased against liquidation. This may induce them to misreport information and even bribe auditors when liquidation would be value-increasing. To restrain fraud,...

According to some of the earliest printed expositions of bookkeeping and accounts, a businessman might keep two ledgers pertaining to the same set of transactions. The second ledger could be an exact copy of the original ledger, to be available if the latter were lost or destroyed. Or, one of...