Deceptive Accounting Practices: Revenue & Expense Manipulation
This course explores deceptive accounting practices used by companies to manipulate revenue and expenses. Participants will learn about specific revenue recognition techniques such as premature revenue recognition, channel stuffing, bill-and-hold arrangements. Participants will also learn about expense manipulation techniques such as capitalizing expenses, shifting expenses, and misclassifying expenses. The course includes detailed examples and highlights the ethical implications and legal consequences of these practices.
Course Information
Price: $24
This course is included in our Mega CPE Subscription.
Course No. CAM016
Format: Online pdf (37 pages). Printed book available.
Prerequisites: None
Advance Preparation:None
Level: Basic
CPE Credit: 2 Hrs.
Field of Study: Accounting: Technical
Course expiration: You have one year from date of purchase to complete the course.
Course Revision Date: November 2024
Objectives
Upon completion of this course, you will be able to:
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- Recognize the key motivations behind deceptive accounting practices
- Identify areas of U.S. GAAP that are most susceptible to manipulation
- Identify techniques used by companies to manipulate revenue in financial statements
- Recognize techniques used by companies to conceal or misstate expenses
Course Contents
U.S. GAAP Susceptible to Deceptive Accounting Practices
Enron & WorldCom
Revenue Recognition Manipulation Techniques
Premature Revenue Recognition
Round-Tripping Transactions
Channel Stuffing
Bill-and-Hold Arrangements
Review Questions
Expense Manipulation Techniques
Capitalizing Expenses
Shifting Expenses
Misclassifying Expenses
Overstating Asset Lives
Deceptive accounting is a technique where financial data is manipulated, distorted, or misrepresented to present a more favorable view of a company’s financial performance, position, or cash flows than what would be presented under strict adherence to accounting standards. This manipulation typically involves exploiting gaps, ambiguities, or weaknesses in accounting standards and principles while staying within legal boundaries.
This practice spans a spectrum of techniques, from relatively minor adjustments to more aggressive maneuvers that can significantly impact financial statements. It often involves strategic decisions by management, accountants, or financial professionals to present financial information in a manner that aligns with desired outcomes, such as meeting earnings targets, boosting stock prices, or securing favorable financing terms. The course includes detailed examples and highlights the ethical implications and legal consequences of these practices.
Ratings and Reviews
Kristin Alongi
Straightforward
Informative without getting into the weeds to bog down concepts.