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Impacts and Losses Caused By the Fraudulent and Manipulated Financial Information on Economic Decisions

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  • Tak ISA

    (The Bucharest Academy of Economic Studies, Romania)

Abstract

Nowadays the effects of the fraudulent and manipulated financial information have been more controversial. We should take into consideration that the financial losses caused by fraudulent or manipulated financial information are remarkable. Preventing the fraud in the financial information has been an important issue by auditors all over the world. As the American economy is the dominant economy may cause and affect the capital market mostly all over the world. In the last decade we can see the financial losses caused by the fraudulent and manipulated financial information rather big. Today’s world has been affected by frauds and manipulation of the financial information. An investment decision based on false financial information causes the investors to suffer losses as was experienced in Enron and WorldCom cases. Financial information has, certainly, an important positive or negative effect in economic decisions. Positive or negative effects of financial information on economic decisions depend on reliability of the financial information. This paper aims to show the impacts of fraudulent on the financial information, effects on economic decision and what we should do for preventing the fraudulent or manipulation on the financial information.

Suggested Citation

  • Tak ISA, 2011. "Impacts and Losses Caused By the Fraudulent and Manipulated Financial Information on Economic Decisions," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 12(5), pages 929-939, December.
  • Handle: RePEc:rom:rmcimn:v:12:y:2011:i:5:p:929-939
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    File URL: http://www.rmci.ase.ro/no12vol5/08.pdf
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    References listed on IDEAS

    as
    1. Aasmund Eilifsen & Kjell Henry Knivsfla & Frode Saettem, 1999. "Earnings manipulation: cost of capital versus tax," European Accounting Review, Taylor & Francis Journals, vol. 8(3), pages 481-491.
    2. repec:bla:joares:v:35:y:1997:i:1:p:83-96 is not listed on IDEAS
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    More about this item

    Keywords

    Financial information; fraudulent; manipulation; decision.;

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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