A Strategy for Dealing with Financial Reporting Fraud: Fewer Mandates, More Auditing*

Salterio, Steven E.

doi:10.1506/ap.7.2.3

Cited by 8 publications

(9 citation statements)

References 24 publications

(22 reference statements)

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“…The first suggestion provided by Salterio (2008) is that accounting regulators need to understand that human motivation requires more conservative accounting standards. I agree fully with that suggestion.…”

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

“…The second recommendation by Salterio (2008) is that Canadian Public Accountability Board (CPAB) inspectors should stop following mandatory checklists and start requiring auditors to be innovative and flexible in their audit approach. I agree with Salterio (2008) that we need auditors to be more creative and unpredictable. However, I cannot imagine how a quasi-government-run bureaucracy (Public Company Accounting Oversight Board [PCAOB]) and a badly constituted Canadian version of said quasigovernmental bureaucracy (CPAB) can possibly lead to innovation, creativity, or flexibility.…”

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

“…However, I cannot imagine how a quasi-government-run bureaucracy (Public Company Accounting Oversight Board [PCAOB]) and a badly constituted Canadian version of said quasigovernmental bureaucracy (CPAB) can possibly lead to innovation, creativity, or flexibility. 2 I also find Salterio's (2008) claim that an audit of internal control will make the auditor unpredictable a bit hard to understand. I think we agree that the detailed (Y2K-like) documentation of internal control mandated by section 404 of SOX is a costly and useless activity.…”

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

“…The third recommendation of Salterio (2008) is that we need more intrusive regulation of audit firms, even to the extent of monitoring the promotion, evaluation, and compensation decisions of audit firms. I think this is a costly and impractical suggestion.…”

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

See 4 more Smart Citations

Building a Better Audit Profession: Align Incentives and Reduce Regulation

Jamal

2008

Accounting Perspectives

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Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

Section: Responses To Salterio's (2008) Three Suggestionsmentioning

confidence: 99%

See 3 more Smart Citations

Building a Better Audit Profession: Align Incentives and Reduce Regulation

Jamal

2008

Accounting Perspectives

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How senior managers perpetuate accounting fraud? Lessons for fraud examiners from an instructional case

Lokanan

2014

Journal of Financial Crime

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Purpose – The purpose of this paper is to examine the risk factors that led to the Livent fraud, and the procedures that need to be taken by responsible parties to carefully investigate and address the incidents of misconduct. Design/methodology/approach – The paper combs through the chronology of events that led to the Livent fraud by looking at both primary and secondary sources. These sources made it possible to examine how the fraud was discovered, and the investigative steps that should have been taken to uncover the fraud. Findings – The findings indicate that a corporate culture which focuses on the bottom line coupled with weak to non-existent internal controls were the key elements that led to the Livent fraud. The findings also illustrate that when faced with declining profits, senior managers will go to any length possible to manipulate and falsify their company’s records. Practical implications – The paper is useful to management personnel and fraud examiners in that it used an actual accounting fraud case to highlight areas more susceptible to fraud and the approach that can be taken to investigate similar cases of misconduct. The paper also highlighted the practical implications for internal and external auditors in detecting and addressing fraud. Originality/value – The study used an accounting fraud case to examine the techniques used by management personnel to produce fraudulent financial statement.

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Renovating the Audit Profession: A Brief Rejoinder to Jamal

Salterio

2008

Accounting Perspectives

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A Strategy for Dealing with Financial Reporting Fraud: Fewer Mandates, More Auditing*

Cited by 8 publications

References 24 publications

Building a Better Audit Profession: Align Incentives and Reduce Regulation

Building a Better Audit Profession: Align Incentives and Reduce Regulation

How senior managers perpetuate accounting fraud? Lessons for fraud examiners from an instructional case

Renovating the Audit Profession: A Brief Rejoinder to Jamal

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