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accounting fraud

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accounting fraud
Accounting fraud can be defined as knowingly falsifying accounting records in order to increase sales revenue and net income. Accounting fraud is committed in corporations by means of showing false information, using funds for illegal purposes or inflate expenses, overstating revenues, understating expenses or overstating the value of corporate assets. All these activities are entirely unethical. Behaving ethically depends on the capability to recongnize the ethical issues and to believe on their existence. This ability to respond ethically at workplace related more to attributes of corporate culture than to attributes of individual employee Individuals often fail to realise their moral obligations at work and by being subject to world’s temptation fails to tread on their set ethical standards and behave unethically. People especially of todays generation are so much engrossed in their own different criterias of their lives that they almost forget to confine themselves to ethical boundaries that is why ethical decisions are always difficult to make and its foundation is based on several factors however if we talk about the decision by considering moral philosophies of a person; that depends on whether the person is making a work-related decision or personal-life decision. A person in the business sector might view of the problem by thinking differently beacause of the outside force and under the work pressure. However, the same decision might be unacceptable to him outside the work. The second reason of people changing moral philosophies could be the corporate culture where they work. Rules and personalities of a business culture person eventually effects on the person and exerts pressure to conform to the firm’s culture. Edward Hall (1959), described culture as a silent language, and defines it as “that part of man’s behavior which he takes for granted, the part he doesn’t think about, since he assumes it is universal or regards it as idiosyncratic.” Geert


References: Arunchand, C H; Ramanathan, Hareesh N. Organizational Culture and Employee Morale: A Public Sector Enterprise Experience, Journal of Strategic Human Resource Management2.1 (2013): 1-8.  Mickalowski, Kyle; Mickelson, Mark; Keltgen, Jaciel Caulkin, S.: 2002, 'Good Thinking, Bad Practice ', The Observer (7th April), 11 Claver, Enrique; Llopis, Juan; Gasco, Jose L. International Journal of Value - Based Management15.2 (2002): 151-163 Drake, B. H.and E. Drake, (1988), “Ethical and legal aspects of managing corporate culture” California management review 30 (2), 107- 123 Fritzche, D Hall, E.T. (1959). The Silent Language, New York: Doubleday Lincoln, D., M Vitell, S. J., et al, (1993), ‘Marketing Norms: The influence of personal moral philosophies and organizational ethical culture’ Journal of the academy of marketing science 21 (4), 331-337, Retrieved from Proquest Database, Viewed on 12 May,14. Yallapragada, RamMohan R.; Roe, C. William; Toma, Alfred G.: Accounting fraud and white collar crimes in the US, Journal of Business Case Studies8.2 (2012): 187. Retrieved from Proquest Database, Viewed on 7 May,14.

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