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Finance & Accounting
Pages 8 (2008 words)
Research Project Name: Instruction: Task: Date: Research Project Cases of fraud constantly dominate televisions, newspapers and radios because they have devastating consequences on organizations. For instance, it leads to loss of jobs, suspensions, jails terms and hefty fines for workers and managers found guilty of fraud related charges.
According to the Generally Accepted Accounting Principles (GAAP), there are several inconsistencies with the five scenarios mentioned. For instance, it is the sole responsibility of GAAP to evaluate and account on the transactions conducted in the company. In other words, it ensures that is correct presentation of the business income and expenses of the corporation in relation to realized profits and losses. On that aspect, for instance, the lease on technology assets on inflated prices constitutes a violation of the GAAP rule of accountability. Additionally, there is also the breach of the principle of full disclosure/materiality (Epstein & Saafir, 2010). In this principle, according to the umbrella of GAAP, the leasing of technology assets should have been made public in terms of the transactions and the records of the sales. There is also the breach of the principle of sincerity. For example, in making understatements of e-commerce state the tax payments, the organization goes against the principality of GAAP that requires sincerity and honesty. Alternatively, this also violates the GAAP principle of regularity whereby a company should abide its sets rules and laws. ...
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