An Analysis of Fraud in the Context of Depreciation Manipulation

Accounting scandals such as Waste Management and Hertz Global Holding\u27s shatter investor confidence, destroy employee retirement plans, and negatively impact the U.S. economy as a whole. By having a clear understanding of the internal and external forces that drive the motivation of fraud, accountants and businesses are better able to prep and set proper internal controls. As proper internal controls prevent fraud, this thesis will explore catching fraud through financial implications, by focusing specifically on the fraud committed through depreciation. In this paper, I will examine prior research related to fraud motivation and consequences. As an analysis of fraud in the context of depreciation manipulation, I will further examine whether the Hertz Corporation fraud could have been detected though an analysis of depreciation percentages of revenues, changes in holding period, and net income trends