Tags :SEC regulations

In the world of accounting, financial fraud is often likened to a meticulously orchestrated magic show—and “Construction in Progress” (CIP) and “Fixed Assets” are the magician’s favorite props. These accounts offer the perfect camouflage for creative accounting, allowing fraudsters to manipulate financial statements with alarming ease. Here’s why they’re so frequently exploited—and how investors and regulators can spot the red flags. 1. The Perfect Hiding Spot: The Illusion of Stability Unlike liquid assets such as accounts receivable or inventory, which are scrutinized regularly, non-current assets like CIP and Fixed Assets move under the radar. Their long-term nature means they aren’t subject to the same immediate pressures—no monthly reconciliations, no frequent audits. 2. Subjective Valuation: A Fraudster’s Playground The pricing of capital projects...

Like(0)SinoLoanExpert2025-03-31Finance 101 asset impairmentaudit riskscapital expenditure fraudconstruction in progress accountingcorporate governancefinancial fraud detectionfixed assets valuationforensic accountingGAAP complianceSEC regulationsViews()