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Reading Financial Reports For Dummies, 4th Edition
book

Reading Financial Reports For Dummies, 4th Edition

by Lita Epstein
April 2022
Beginner content levelBeginner
384 pages
9h 56m
English
For Dummies
Content preview from Reading Financial Reports For Dummies, 4th Edition

Chapter 17

How Companies Find Errors: The Auditing Process

IN THIS CHAPTER

check Getting acquainted with audits and auditors

check Checking out the auditing process

check Exploring accounting standards and principles

Most readers of financial reports don't work for the company whose reports they're reading and, therefore, must depend on the truthfulness of the company's management in reporting its financial statements. Can you depend on the numbers you see?

The question is valid, especially considering the corporate scandals that have rocked Wall Street since the collapse of Enron in December 2001. (To find out more about why the world's largest electricity and natural gas trader filed for bankruptcy, see Chapter 23.) The Enron scandal — followed by financial reporting scandals at other major corporations such as MCI WorldCom, Adelphia, AIG, and many others — led investors to be wary about the numbers companies put in their financial reports. In the more recent scandal that broke in 2020, Wells Fargo employees created fake profiles to file fraudulent applications in order to benefit from the Small Business Administration’s relief program during the Covid pandemic.

In this chapter, I explore how ...

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Publisher Resources

ISBN: 9781119871361Purchase Link