order to keep funds flowing. In contrast, this paper finds that total (expected) manipulation across two rounds of short …-term financing may be either greater than or lower than manipulation with long-term financing. Manipulation in the two rounds may … either act as complements or substitutes, depending on whether one is looking forward or backward in time. Regulatory fraud …

reduces its costs. Our model predicts that stronger reporting oversight leads to greater accounting conservatism, manipulation … to manipulate accounting reports. In our setting, ceteris paribus, conservative accounting is desirable because it allows … the manager to manipulate the accounting system to mislead the board and distort its decisions. Effective reporting …

reduces its costs. Our model predicts that stronger reporting oversight leads to greater accounting conservatism, manipulation … to manipulate accounting reports. In our setting, ceteris paribus, conservative accounting is desirable because it allows … the manager to manipulate the accounting system to mislead the board and distort its decisions. Effective reporting …

parsimonious explanation for several empirical regularities documented in the literature on fraud …

We develop an agency model in which managerial information manipulation creates pooling and entails ex-post costs … an external regulatory authority or RA (who investigates for fraud and levies penalties ex post). When the RA cannot pre …