10 Fundamentals of Governance, Accounting, and Fraud: Insights for Current and Future Financial Professionals Academic Article uri icon

Abstract

  • We have been actively involved in various aspects of corporate governance, accounting, and fraud for over 100 years collectively, including our work in research, teaching, and practice. During this time, we have observed that certain issues reflect key fundamentals of governance, accounting, and fraud.
    In this commentary, we discuss ten of these fundamentals (see Exhibit 1 below) and develop insights for current and future financial professionals. These fundamentals go far beyond the numbers in accounting to include the organizational setting, correlation versus causation, processes, regulation, politics, people, the “self-graded exam” issue, pressure, pay, and appearing stupid versus dishonest. While we cite relevant research on many points, we also include our personal observations and assertions based on our experiences.
    We hope that these fundamentals will be useful to readers serving in a wide variety of accounting, auditing, and fraud prevention roles. Specifically, we encourage practitioner readers to share this commentary with colleagues, especially those in more junior roles. We encourage academic readers to consider using this commentary as a supplemental course reading to help students develop a richer understanding of governance, accounting, and fraud.

Publication Date

  • 2025-12-01