Causes, consequences, and deterence of financial statement fraud (original) (raw)

This paper discusses the significant issue of financial statement fraud (FSF) in corporate America, emphasizing its causes, consequences, and deterrence measures. High-profile cases such as Enron and WorldCom illustrate the devastating impacts of FSF, including massive losses in market capitalization and erosion of public trust. The analysis highlights failures in corporate governance and audit functions, suggesting that irresponsible management practices and a lack of accountability contribute to FSF. Recommendations for improvement include stronger oversight and ethical compliance to restore confidence in financial reporting.