Submitted by: Submitted by anna2555
Views: 580
Words: 313
Pages: 2
Category: Business and Industry
Date Submitted: 07/08/2012 01:16 PM
Control Overrides in Financial Statement Fraud
Shirley Ann Anderson
Walden University
May 1, 2012
In this Discussion, you will evaluate and consider the importance, value, and impact of accountability and responsibility on businesses and their stakeholders. Tell your colleagues what you have learned about financial statement fraud.
1. What does it mean to "engineer financial results?"
According to IAFE, International Association of Financial Engineers, Financial engineering is the application of mathematical methods to the solution of problems in finance. Answers.com has financial engineering defined as, application of economic principles to the dynamics of securities markets, especially for the purpose of structuring, pricing, and managing the risk of financial contracts.
Engineering financial results would be to take actual financial data and change it to give a company better financial position in the market.
2. What are the challenges associated with this practice, and is there ever any "grey area?"
The challenges associated with this practice would be to not become corrupted and use the GREY AREAS, or accounting loopholes that are in the system, thus the downfall of companies such as Enron. If a company has a sense of ethical accountability, then there is no room for grey areas.
3. Are there any situations in which it might be considered ethical to engineer financial results?
When a company or a person intentionally sets out to make fraudulent documents it is never ethical. This applies to large and small companies.
4. Does your answer change in the context of a small, family-owned business versus a major global corporation?
No my answer does not change when it comes to small, family owned businesses. Family businesses should be held to the same standards as larger corporations.
References:
Resources : What is financial engineering. (n.d.) Retrieved from http://iafe.org/html/resources_what.php
Financial...