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Illegal Accounting Practices

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Discuss at least eight examples of illegal accounting practices that could result in incarceration? They could be real life instances or just examples.

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This solution assists in discussing illegal accounting practices.

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1) Smoothing Out
1) In February, 2003, the Federal Home Loan Mortgage Corporation, almost universally known as Freddie Mac, came under fire for illegal accounting practices. Specifically, Freddie was accused of using unlawful techniques to "smooth out" volatility in revenues and earnings, with an alleged primary aim of meeting goals that would generate bonuses for top senior management. These practices would also, presumably, encourage increases in the corporation's stock value.

2) The use of off-balance-sheet partnerships and reserves to "manage" reported earnings

3) The re-categorization of investments to enable gains to be booked on the company's income statements

4) The reorganization of business ...

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