This chapter will help the readers to:
- Understand the regulatory framework in place to ensure that the financial statements are reliable.
- Appreciate the accounting areas where managerial discretion is available.
- Develop familiarity with the common areas of creative accounting.
- Dissect some of the infamous accounting scams of recent times.
- Apply techniques to detect financial shenanigans.
- Appreciate the need for ethics in accounting.
As discussed in Chapter 1, the accounting information is prepared by the management and used by a large number of stakeholders for taking economic decisions. The end result of the accounting cycle, i.e., the three key financial statements—balance ...