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Saturday, July 23, 2011

Book Review: The Complete Guide to Spotting Accounting Fraud and Cover-Ups

Our Librarywala website has a whole lot of corporate members and they're feeling slightly ignored with our reviews on books in the fiction category. So we gladly dedicate this book review to all of them!

The book we bring to you was the first place winner of the Indie Awards held in 2010 in the Finance Category. Guest reviewer, Erin E. Schmidt Smith pitched in this week with her review of Martha Maeda's brilliant book on accounting fraud. By all standards, this is a book that will definitely help you spot a muddled up balance sheet when you see one! This is what she says about it:

When I first started The Complete Guide to Spotting Accounting Fraud & Cover-Ups: Everything You Need to Know Explained Simply by Martha Maeda (Atlantic Publishing Group, 2010), I thought I was going to be bored. Actually, this book is quite fascinating. It promises to be easy to read, and it lives up to that promise, even for someone who'd had no background in accounting or finances.

There are plenty of examples, including the cases of Bernard Madoff and Martha Stewart and examples from Coca-Cola, AOL, the International Olympic Committee and more that show how the lessons apply to real life. As a psychology major, I found the discussion of psychopathic personality disorder in business especially fascinating.

 This book is also very thorough. It discusses in detail the different kinds of frauds that are most likely to occur, why they occur, and who is most likely to be involved in them. More important, it details the ways owners of businesses large and small and investors can keep an eye out for the various kinds of fraud. Numerous resources went into researching this book, and Maeda shares the particularly valuable and user-friendly resources with the reader.

 According to the introduction, organizations in the USA lose about 7% of their annual revenue to fraud, or an estimated $994 billion total. For these reasons, anyone who runs a business or a charity (even church groups) or who has investments should read through it at least once.

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