Evaluate the types of financial statement fraud that has occurred in the past and predict what types of fraud may / or may not be committed in the future. Support your prediction(s) with examples.

Imagineyouarethecontrollerofamajornewtechstart-up.UppermanagementisputtingpressureonyoutoexceedWallStreetsearningsexpectationsforthenextquarter.Youhavedecidedthatyouhavetocookthebooksinordertoexceedexpectations.Createaschemetoincreaseearningsforthequarter.Supportyourschemewithexamples.

• Analyze the current control structure for safeguarding financial reporting. Based on your analysis, recommend changes that will strengthen the current control structure. Support your recommendations with examples and rationale.
• YouhavejustbeenhiredbyXYZCompanyasasenior-levelaccountant.Youthinkyouhavediscoveredwhatyoubelievetobefraudinthelatestfinancialstatements.Proposewhatactionsyoumighttakeregardingwhatyouhavediscovered.Supportyourproposalwithexamples.
• From the e-Activity, analyze the major cause(s) of the financial statement fraud and recommend changes that would have prevented the fraud. Support your recommendations with examples and rationale.
• Analyzecommoncausesforfinancialstatementfraud.Basedonyouranalysis,developaprofilethatcompaniesshouldusetopredictfraudpotentialintheirorganizationsandrecommendactionstepstotakewhenfraudpotentialappears.Providearationaleforyourrecommendations.
• Imagineyouareanaccountantworkingonclosingthebooksfortheyearend.Giventhatmanyaccountingitemsrelyonestimates,constructascenarioinwhichyouwouldquestionanestimateasbeingeithertoohighortoolowthatwouldmisstateearnings.Supportyouranswerwithexamples.
• ImaginethatyouareontheboardofdirectorsforXYZCompany.Youhavereceivedananonymoustipthatthefinancialstatementswerepreparedinafraudulentmanner.Yourinitialreactionisthatthethreatlevelishigh.Developaplanofactionthatyouwouldtaketoreacttothisallegation.Supportyourplanwithexamplesandprovidearationale.