StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Financial Fraud and Corporate Social Responsibility - Essay Example

Cite this document
Summary
The aim of the paper “Financial Fraud and Corporate Social Responsibility” is to analyze financial fraud, which is described as a global act of deception involving monetary deals for the aim of individual achievement. Fraud is a great-complicated field…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER92.8% of users find it useful
Financial Fraud and Corporate Social Responsibility
Read Text Preview

Extract of sample "Financial Fraud and Corporate Social Responsibility"

Financial Fraud and Corporate Social ResponsibilityIntroductionFraud and Corporate Social Responsibility exhibit themselves in organizations, mainly business organizations and they have their own effects and the way they affect the economy. By narrowing down to each one of them and giving their definitions, fraud in business has the name financial fraud and is described as a global act of deception involving monetary deals for aim of individual achievement. Financial fraud may as well have the definition as a condition in which the legal and moral control of monetary resources does not occur.

This kind of fraud happens due to intentional decisions and deeds made by individuals who deal with funds and other assets on behalf of bosses or customers. On the other hand, corporate social responsibility is the process through which businesses continue to dedicate their moral behavior and lead to economic growth while raising the quality of livelihood of the labor and their households including the local society and community as a whole. Fraud is a great-complicated field, and the degree of auditor responsibility for the protection and discovery of fraud has been the theme of debate for several years.

It is a key area of monetary reporting that has been accountable for the ‘expectations gap’ between clients of accounts and auditors (Sarbanes-Oxley 13).BodyNina and Ariely nevertheless, argue that as the reporting atmosphere has turned further sophisticated; furthermore, due to the spate of corporate scandals, there has been the urgency to make sure that auditors presumed further responsibility in their reporting function. Fraudulent financial reporting importantly influences not just the organizations and institutions in which the perpetuation of such frauds occurs, however, the trust of the civic in the capital markets.

Sarbanes argues that corporate and criminal fraud reporting is the felony to “intentionally” demolish or form documents to “hinder, prevent or affect” any prevailing or considered federal inquiries. Auditors have the responsibility of keeping “the total auditor or review task papers” for a period of five decades. Workers of issuers and accounting organizations are extended “whistleblower security” that could prevent the boss from taking specific measures against workers who legally reveal private boss data to, amidst others, parties in a legal hearing involving a fraud accusation.

Whistleblowers remain as well given a remedy of extraordinary harms and attorney’s cost. Moreover, Nina Mazar adds to corporate disgraces that nearly all organizations present their workers with the disagreement between egoistically following their personal monetary objectives and being faithful. Brokerage institutions demonstrate perhaps the major obvious examples of such institutions. Despite brokers having the mandate to act on their customer’s best concerns, the commission’s scheme may try them to select individual achievements over their customers’ concerns.

According to Friedman, Milton, and Dunn, the subject of social responsibility remains regularly a cloak of deeds that are explained on other grounds other than a cause for those deeds. He moreover claims that the principle of “social responsibility” when taken keenly could lengthen the scope of the political mechanism to each human operation. It does not vary in philosophy from the major openly collective principle. It varies just through professing to trust that collectivist edges can remain achieved lacking collectivist ways.

According to Forest, Richard, and Robert, in the context of Corporate Social Responsibility (CSR), the social welfare proposes that organizations must venture in projects that output the greatest level of societal welfare; and it remains advisable to permit CSR if aggregate welfare has possibility of being high when CSR has permission that when it has prevented. The effects of CSR constitute straight welfare achievements to people, like asthmatics staying close to a power company that willingly lowers its emissions.

Additional, widely, if organizations willingly internalize externalities, a further effective distribution of resources can happen. There is no cause ex ante, to expect that organizations will lower externality-outputting tasks to effective levels. The straight costs of CSR are the failure of customer surplus emerging from organizations producing little results to raised charges and thus at expensive prices. Despite legality not being identical with societal desirability, a few observers could really recognize legality as a normative measure through which to arbitrate several deeds.

A claim that can be made versus CSR is that it is not an independent procedure. There is no specific reason to trust that community must prefer organizations’ selections and priorities over the selections and priorities of an independent state. Some scholars may as well claim that corporations already dominate too many features of contemporary life, and that there could be no wish for them to manage the distribution of public products also. In a wider view, the notion of social responsibility; however may claim that businesses have an ethical dedication to conduct themselves highly moral and exhibit great ethical norms, and to involve themselves in tasks that benefit the community.

Thus, fraud is the wrong presentation or misinterpretation of financial statements due to self-interest whereas CSR is the dedication of organizations to give back to the society (Reinhardt 26).ConclusionIt is clear that fraud in business settings prevails and this is mainly due to the selfish interests of the auditors and executives. However, auditors must show social responsibility when carrying out their professional duties. CSR has no legal obligations, but organizations must give back to the society to facilitate development and advancement of the society, and to create a peaceful operating environment for them.

Fraudulent activities have massive implications and thus people must learn how to act professionally in order to maintain their image as well as the image of the institution in question. Likewise, CSR improves the image of the company to the society and the globe at large (Reinhardt 28).Work citedReinhardt, Forest L. Corporate Social Responsibility Through an Economic Lens: Harvard Kennedy School. 2008. Print.Friedman, Milton, Dunn, Craig p. The Social Responsibility is to Increase its Profits: The New York Times Magazine. 1970. Print.

Mazar, Nina, Ariely, Dan. Dishonesty in Everyday Life and its Policy Implications: American Marketing Association. 2006. Print.Oxley- Sarbanes. Summary of the Provisions of the Sarbanes-Oxley Act of 2002: AICPA. 2002. Print.

Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Financial Fraud and Corporate Social Responsibility Essay”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1490095-read
(Financial Fraud and Corporate Social Responsibility Essay)
https://studentshare.org/macro-microeconomics/1490095-read.
“Financial Fraud and Corporate Social Responsibility Essay”, n.d. https://studentshare.org/macro-microeconomics/1490095-read.
  • Cited: 0 times

CHECK THESE SAMPLES OF Financial Fraud and Corporate Social Responsibility

Re-evaluating Milton Friedmans Concept of Social Responsibility of Business

Re-evaluating Milton Friedman's Concept of social responsibility of Business Introduction “The primary and only responsibility of business is to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception and fraud” - Milton Friedman (1970) The above mentioned lines are not only a quotation by the most influential economist in the second half of twentieth century but also the crux of this essay....
12 Pages (3000 words) Essay

The Concept of Corporate Social Responsibility in the Financial Crisis

corporate social responsibility With the rapid changes taking place in the corporate world, coupled with high competition, in addition to, the greater environmental and social awareness that characterizes the global corporate environments (Lee & Carroll 2011, p.... Among the many corporate strategies that have been adopted in the corporate world, to ensure both sustainability and profitability is the concept of corporate social responsibility (CSR), which has gradually achieved massive popularity and significance in businesses world over....
10 Pages (2500 words) Essay

Corporate Social Responsibility

Name: Institution: Course: Instructor: Date: The idea of social corporate social responsibility as brought forward by proponents of free market is fallacious as the main goal of business enterprises is to make profits; this is because the interests of business owners and those of the community are different and divergent from each other.... The big challenge lies in whether the business should sacrifice their profits to perform activities that are considered as part of their corporate social responsibility....
3 Pages (750 words) Essay

Discuss the definitions and characteristics of White Collar Crime

Sutherland's definition of white collar crime goes this way: ‘white collar crime is the crime committed by a person of respectability and high social status in the course of his occupation”.... s 1347(2) as follows: Under the common law and the Model Penal Code, theft is ‘the taking of another's property by trespass with intent to deprive… Whereas fraud, which did not exist at common law, "means to cheat or wrongfully deprive another of his property by deception or artifice," and "implies deceit, deception, artifice, trickery," White collar fraud in essence is the seed of a White collar fraud does not carry any act of violence with it....
12 Pages (3000 words) Essay

Corporate Governance and Corporate Responsibility

From this work, it is clear that researchers increasingly feel that the concept of corporate governance and social responsibility is complementary, and should be pursued in totality to attain the best results.... This work "Corporate Governance and corporate Responsibility" describes the concept of corporate governance in various countries, their responsibilities.... corporate governance provides the framework according to which a company must be controlled and directed and how managers and the members of the board should act....
7 Pages (1750 words) Article

Information Technology Audit Requirements

The late 20th and early 21st centuries witnessed increasing affront on the integrity and reputation of the United States of America due to endless rise in cases of corporate scandals and wanton corruption in the business sector.... During this period, the corporate America… These instances provoked the debate on the need for the introduction of legislation that could counteract the adverse economic menace.... In the first twenty years after the enactment of the Foreign Corrupt Practice Act 1977, the American Security and Exchange Commission and the America Department of Justice did very little investigations to necessitate a helpful enforcement of the Act, reducing its impacts in countering corporate bribery and other business malpractices....
10 Pages (2500 words) Term Paper

Principles of Corporate Social Responsibility

This paper will attempt to explain the principles of 'corporate social responsibility', its importance in the corporate world and the extent to which recession has affected its activities.... For meeting the objectives of corporate sustainability, organizations resort to corporate social responsibility in its strategic management process.... Specifically, corporate sustainability can be termed as 'corporate social responsibility'.... corporate social responsibility helps firms to achieve their corporate sustainability....
8 Pages (2000 words) Term Paper

The Enron Corporate Scandal

These frauds have given rise to the special concern over the corporate social responsibility of all the people who are involved in the process of running the business Following the formation of the company, staffs of executives were developed, who were led by Jeffery Skilling, who started to manipulate the accounting ambiguities and the meager reporting of financial data was able to veil the deals that amounted to billions of dollars that had resulted in failures.... The author describes Enron corporate scandal and concludes that the corporate executives should put their utmost efforts together in order to prevent the instances of window dressing as it shakes the very foundation of the society and rather tries to protect the interest of the public stakeholders… In the recent past, many corporate frauds have come to light which has involved some of the very famous names in the corporate history....
8 Pages (2000 words) Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us