Prevention of financial crime: review of modern accounting technique
Keywords:
accounting, financial crimes, laws and regulationsAbstract
Purpose: This article will examine the concept and practice of creative accounting, including how it is circumvented and how it might lead to financial crimes. The procedure that is followed and the individuals who are involved and who are the victims of these acts. The means employed and the manner in which the action is carried out. The primary objective of the study is to examine the findings of different researchers who have investigated the same issue and to propose solutions.
Design/Methodology/Approach: This study is intended to investigate the operation of accounting policies and how loopholes in the same can be actually accounted for, resulting in specific number games that can be played around it, in order to get the desired result in the creation of financial statements.
Findings: Creative accounting, though legal and acceptable around the world, opens the door to loopholes granted by the laws and regulations controlling the preparation of financial statements, ultimately leading to financial crimes and harming the economy overall.
Research limitations/Implications: This study is limited by the fact that it is an empirical study, since a large number of papers and articles were reviewed prior to giving it form and drawing a conclusion. Although creative accounting is not prohibited, its excessive use has had frightening implications on financial accounts, leading to financial crimes and the theft of people's money across the globe. Due to the fact that investors' hard-earned money is being stolen and no action can be taken because the system and legal organizations are still attempting to control the problem, it is crucial to acquire knowledge about creative accounting.
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