Accounting fraud
Global Economic Crime Survey 2014
Financial statements are a fundamental barometer of a business — and a traditional starting point for analyses relating to credit decisions, contract awards, and capital raising in public markets. They are the bedrock of the trust that is essential to the orderly functioning of the financial marketplace.
Accounting fraud — which includes misleading or falsely prepared financial statements — can deceive banks, lessors, vendors, and investors into risky or misguided decisions. Due to the use of financial statements and financial data throughout business operations, this kind of economic crime impacts a variety of business processes.
Accounting fraud has consistently been one of the major crimes reported in our survey. Since 2005 it has been cited by over 20% of our respondents who experienced economic crime. This year was no exception, as 22% of respondents reported experiencing accounting fraud, with wide regional variations.
As the chart above shows, the Middle East and Africa report notably more accounting fraud than the global rate of 22%, with a response rate of over one third. Asia Pacific and North American respondents reflect the global average of 22%. We believe this may reflect the megatrend of wealth moving from West to East, as many businesses and private equity funds are investing in emerging-market economies.
Source: PwC: Accounting fraud – Global Economic Crime Survey 2014
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