A question of trust

 

 

As the various pressures increase on businesses the integrity of financial reporting has never been more crucial.

 

With companies and individuals desperate to achieve profit targets the potential for abuse may prove to be too much of a temptation
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It is important that systems are in place to prevent misreporting and in worse case scenarios fraud and these systems should be reviewed and rigorously checked.

The fallout from numerous banking scandals illustrate how vulnerable institutions are if their personnel choose or are allowed to camouflage the extent of their exposure to unanticipated market movements.

Fraud is not confined to any one business sector. Despite the increased presence of computer modelling to monitor risk there is always the “human element” which has to be considered.

 

Nobody has devised a fail-safe system which affords 100% comfort but in many instances a closer objective scrutiny would have given sufficient warning to have averted a train wreck.