Answer
Concern exists about fraudulent financial reporting because it can undermine the entire financial reporting process. Failure to provide information to users that is accurate can lead to inappropriate allocations of resources in our economy. In addition, failure to detect massive fraud can lead to additional governmental oversight of the accounting profession.
Work Step by Step
In the long term, this may adversely affect the economy of a country and lead to dire consequences such as inflation, unemployment, and devalued currency. Such economic situations are very difficult to solve.
