Difference between revisions of "Accounting fraud"

49 bytes added ,  14:49, 4 October 2021
Line 84: Line 84:
=='''Fraudulent Management Estimates and “Cookie Jar” Reserves'''==
=='''Fraudulent Management Estimates and “Cookie Jar” Reserves'''==


*'''<u>SEC v. Computer Sciences Corporation</u>'''
*'''[https://www.sec.gov/litigation/admin/2015/33-9804.pdf SEC v. Computer Sciences Corporation]'''


On June 5, 2015, Computer Sciences Corporation agreed to pay '''$190 million''' to settle charges that the company engaged in a wide-range accounting-and-disclosure fraud that materially overstated its earnings and concealed from investors significant problems with its largest contract. According to the SEC’s order, the company’s former Finance Director prepared a fraudulent accounting model in which he included made-up assumptions to avoid reporting a negative hit to the company’s earnings. The company also overstated its earnings by using “cookie jar” reserves and by failing to record expenses as required.
On June 5, 2015, Computer Sciences Corporation agreed to pay '''$190 million''' to settle charges that the company engaged in a wide-range accounting-and-disclosure fraud that materially overstated its earnings and concealed from investors significant problems with its largest contract. According to the SEC’s order, the company’s former Finance Director prepared a fraudulent accounting model in which he included made-up assumptions to avoid reporting a negative hit to the company’s earnings. The company also overstated its earnings by using “cookie jar” reserves and by failing to record expenses as required.