When the numbers mislead
Creative accounting and external audit.
- Level
- Bitesize
- Learning time
- 1 hour 15 minutes
- Where
- Finance for Non Finance Professionals
- Price
- £39
When you step up to a higher level, what you paid in the last 12 months for lower-level courses inside the bigger course comes off its price, in proportion to how much of each is inside it, whichever topic it's from. Courses at the same or a lower level don't give credit against each other. A Focus course or above always costs at least £15. Read the full terms
Certificate of Completion
Overview and Outcomes.
Overview
This module explores how judgement, incentives and fraud risk can shape the figures a board relies on. It covers four places numbers can bend, prudent versus aggressive accounting, Goodhart's law as restated by Marilyn Strathern, and Cressey's fraud triangle of pressure, opportunity and rationalisation. Through the Tesco 2014 and Wirecard cases, it sets out five practical board defences, including treating the challenger as information. This module looks at external audit from the board's seat: what an audit tells you, what it cannot, and how boards get real value from their auditors. It covers true and fair, the expectation gap, the four audit opinions, going concern under ISA (UK) 570, key audit matters and management letters, private sessions with auditors, stalled reform of the FRC, and England's local audit backlog and backstop dates.
What you'll develop
In this Bitesize, you will develop the ability to:
- Identify the four places where accounting judgement can bend results, and distinguish prudent from aggressive choices made on the same facts.
- Explain how Goodhart's law and Cressey's fraud triangle help account for misleading numbers, using the Tesco and Wirecard cases.
- Apply five practical board defences, from naming the key judgements to protecting the voices of those who raise concerns.
- Explain what an audit is and is not, including true and fair, materiality and the expectation gap.
- Distinguish unmodified, qualified, adverse and disclaimed opinions, and interpret going concern disclosures, key audit matters and management letters.
The Modules.
1 hour 15 minutes of learning.
- 08When the Numbers MisleadThis module explores how judgement, incentives and fraud risk can shape the figures a board relies on. It covers four places numbers can bend, prudent versus aggressive accounting, Goodhart's law as restated by Marilyn Strathern, and Cressey's fraud triangle of pressure, opportunity and rationalisation. Through the Tesco 2014 and Wirecard cases, it sets out five practical board defences, including treating the challenger as information.39 min
- 09External Audit from the Board's SeatThis module looks at external audit from the board's seat: what an audit tells you, what it cannot, and how boards get real value from their auditors. It covers true and fair, the expectation gap, the four audit opinions, going concern under ISA (UK) 570, key audit matters and management letters, private sessions with auditors, stalled reform of the FRC, and England's local audit backlog and backstop dates.40 min
Keep going.
Part of the Finance for Non Finance Professionals topic, also sold whole as Follow the money.
Go deeper, and pay only the difference
- You are hereBitesize, 1 hour 15 minutes, £39
- Next stepFocus, Numbers that tell the truth, 4 hours, £69. Already own the Bitesize? You pay £30.
- Explore, Financial literacy for leaders, 6 hours, £129. Already own the Bitesize? You pay £90.
- The whole topicImmerse, Follow the money, 11 hours, £249. Already own the Bitesize? You pay £210.
When you step up to a higher level, what you paid in the last 12 months for lower-level courses inside the bigger course comes off its price, in proportion to how much of each is inside it, whichever topic it's from. Courses at the same or a lower level don't give credit against each other. A Focus course or above always costs at least £15. Prices per person. Read the full terms
Also part of: Governing the money
Other Bitesize in the Finance for Non Finance Professionals topic
- Did we live within our means?The language of finance and the income statement2 hours£39
- Reserves and cashThe balance sheet, reserves and cash flow1 hour 15 minutes£39
- Reading between the linesReading accounts and spotting warning signs1 hour 15 minutes£39
- What things really costCost behaviour, overheads and activity-based costing1 hour 15 minutes£39
- Value for money, budgets that workInvestment appraisal and budgeting approaches1 hour 15 minutes£39
- Keeping the budget honestBudget monitoring, capital and borrowing1 hour 15 minutes£39
