Financial Reporting Falsification: Types, Identification Tools, Responsibility

Financial reporting plays a key role in providing complete, reliable, and systematized information about the financial position of an economic entity. Users of financial reporting are interested in receiving relevant and high-quality information to make their management decisions. Misstatements of financial reporting significantly affect the transparency and reliability of the information provided, which emphasizes the need to apply effective measures to detect and prevent such misstatements. The purpose of this study is to study the approaches to financial reporting and its misstatements and the choice of techniques and methods for the identification of falsification in financial reporting. This article examines the definition of “financial reporting.” The main methods of falsification identification in financial reporting are analyzed. They are audit and economic analysis, with special attention paid to mathematical models for calculating financial indicators. The article examines the tools for the identification of misstatements in financial reporting: the Messod-Benish model and comparative characteristics of modified methods used by Russian enterprises. The necessity of using new tools for the identification of falsification of financial reporting, taking into account the Russian economic environment, was proved. The article examines the types of financial reporting misstatements: intentional (deliberate) and accidental (unintentional) misstatements. The responsibility for financial falsification within the framework of Russian legislation is reflected. The subjects and objects of the crime are defined; the actions that are the objective side of the crime of financial reporting misstatement are given. The author provides an analysis of statistical data for the last eight years on judicial statistics for intentional financial reporting misstatements. The results of the study can be used in the development of measures to combat the financial reporting falsification and the development of practical measures aimed at providing reliable reporting forms.