Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in Financial Reports
Enlarge cover
Rate this book
Clear rating

Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in Financial Reports

4.06 of 5 stars 4.06  ·  rating details  ·  309 ratings  ·  25 reviews
From the " Sherlock Holmes of Accounting," the tools you need to stay a step ahead of the crooks

"Howard Schilit is the authority on forensic accounting. "Financial Shenanigans" is invaluable reading for market participants seeking to identify deceptive behavior in company financial statements." Julian Robertson, legendary investor and founder, Tiger Management

"A must-read!...more
Hardcover, Third Edition, 318 pages
Published May 7th 2010 by McGraw-Hill (first published February 1st 1993)
more details... edit details

Friend Reviews

To see what your friends thought of this book, please sign up.

Reader Q&A

To ask other readers questions about Financial Shenanigans, please sign up.

Be the first to ask a question about Financial Shenanigans

This book is not yet featured on Listopia. Add this book to your favorite list »

Community Reviews

(showing 1-30 of 909)
filter  |  sort: default (?)  |  rating details
Robert W
Financial Shenanigans is by Howard Schilit, president of the Center for Financial Research and Analysis. It is a very readable step-by-step guide to detecting fraud by reading financial statements.

Most of the big corporate scandals in the past few years have been in one way or another accounting scandals. Either accounting was the primary method of committing fraud, or else accounting was used to cover up other malfeasance. Schilit identifies seven "shenanigans" and the ways they are typically p...more
Maxim
A must read for financial analysts and investors. I found this book useful even as I read it after completing my CFA.
The author describes most common accounting tricks management may use to manipulate fin reportings, he names signs of a possible accounting fraud as "red flags". The book is full of recent real life examples, some humour also presents. There is a usefull summary of all technics in the book's end.
Main lessons I learned from the book are:
1) you should always be sceptiacal about an...more
Marcelo
An excellent book. The author goes on a step-by-step investigation of a wide array of possible accounting manipulations by fraudulent or ill-intentioned companies. After reading it, you'll learn to be healthily skeptical of quarterly results and conference calls.

For me, an interesting lesson to be taken out of this book is how it's so easy for management to trick investors in a given quarter if they're willing to do so, even if you've read this book before - oh boy, accounting can be so easily m...more
L.
Read this book for my audit 2 class. Really amazing how many sneaky ways companies have of trying to show improved performance. No wonder so much fraud is never caught - it's got to be hard to find a lot of this stuff! Another thing that really surprised me was the number of example companies used in the book (other than the big obvious ones). There were companies who had gotten in trouble with the SEC for all kinds of things that I hadn't even heard about. No wonder everyone always talks about...more
Brian Zheng
Fantastic Book about all the shenanigans/tricks the management can play to manipulate the financial report. It showed how important it is for the term "quality of earning", when management simply has too much operational flexibility to manage the earning, and manipulate almost every single entry of the financial report. Reading all the details of the financial report especially the footnotes become essential to dig all the shenanigans they are playing to have a good view of what the real earning...more
Vonetta
I'm sort of amazed at how many ways there are to commit accounting fraud. I took a class in business school called "Analyzing Earnings Quality" that only tapped the surface of some of these issues. This book, oddly enough, is both repetitive and extensive at the same time. It's basically a 300-page list of things for equity analysts and investors to look for. To that end, it's overwhelming. But on the other foot, it's incredibly useful.
Tirath
Absolutely fantastic book on some of the coolest shenanigans in the recent past.
Oddly, the author has also made a few passing remarks about the Satyam fraud. A massive Indian fraud in a quite well-known global company which many authors have chosen to ignore.
A must-read for people who like detailed analyses of companies/ financials.
And yes, a very easy read for people who understand financial statements.

- A good go-back-to
Joseph
The book is easy to follow. And it always has some preview for the chapters ahead. Still it took me a while to finish it because I m personally not that interested in detecting financial shenanigans or accounting gimmicks.

However, to those who would like to further explore this topic, this book is a definite read.
Papal Bull
A must read if you want to start investing in public companies. It has a nice cheat sheet when you look at financial statements. However, hindsight is 20/20 and looking back the shenanigans are fairly obvious. If the shenanigans were so obvious everyone would have abandoned Enron and Coleman years earlier.
May
A solid basic book on what to look for when analyzing the shenanigans of a company. It gave me a few good ideas on adjusting my process. I woudl recommend to those that are learning to become skeptics of management teams and earnings releases.
Benjamin
This book provides an extensive case study of various accounting shenanigans that corporations have used. It's organized by category and provides many detailed examples of each kind of accounting "creativity".
Jimyip
The shenanigans are properly explained with numerous REAL examples. This approach makes understanding much easier than many other financial analysis textbooks which focuses merely on technical details
Camilla
This was one of the best books I've had to read for class (which is good, because it's required reading again next semester). I don't think it would be very useful to anyone who isn't an auditor or investor.
Elaine
Feb 12, 2013 Elaine marked it as to-read  ·  review of another edition
A how-to manual for manipulating revenues, expenses, and cash flow. This book describes common - and fradulent - schemes to increase earnings and cash.

This book is in the library.
AC
Another classic -- for those who remember the quip (I first heard about it via Abe Brillof) that GAAP should be renamed: Commonly Reported Accounting Principles
Chatfield
This is fairly easy to read and interesting in what to look for in companies financial statements that may indicate some funny accounting going on.
David
interesting read on identifying 7 sets of financial/accounting scams practiced by many companies nowadays..
Good 3 day read..
Aharon
A slight book that could stand to be slighter. But hey: accounting is accounting. 4 stars!
Giorgos
A reference book on accounting "cooking"
Evan
Very good technical view
Maryanne
Sep 02, 2010 Maryanne is currently reading it  ·  review of another edition
Handy little book!!
Ming
quite possibly the best book on what perspectives to take in reading financial statements. Oh the games bad managers play...
Lianna
Apr 16, 2012 Lianna is currently reading it  ·  review of another edition
YES!
Conor Ferguson
Conor Ferguson is currently reading it
Sep 18, 2014
Ezra Crangle
Ezra Crangle marked it as to-read
Sep 18, 2014
Max Oltersdorf
Max Oltersdorf marked it as to-read
Sep 15, 2014
Susan Wang
Susan Wang marked it as to-read
Sep 15, 2014
Yeap Naw
Yeap Naw is currently reading it
Sep 14, 2014
« previous 1 3 4 5 6 7 8 9 30 31 next »
There are no discussion topics on this book yet. Be the first to start one »
  • The Interpretation of Financial Statements: The Classic 1937 Edition
  • Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor
  • Value Investing: From Graham to Buffett and Beyond
  • You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market Profits
  • Common Stocks and Uncommon Profits and Other Writings
  • Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger
  • When Markets Collide: Investment Strategies for the Age of Global Economic Change
  • The Most Important Thing: Uncommon Sense for the Thoughtful Investor
  • The Dhandho Investor: The Low-Risk Value Method to High Returns
  • The Essays of Warren Buffett: Lessons for Corporate America
  • The Alchemy of Finance
  • Beating the Street
  • Hedge Fund Market Wizards
  • Stocks for the Long Run
  • Valuation: Measuring and Managing the Value of Companies
  • A Demon of Our Own Design: Markets, Hedge Funds, and the Perils of Financial Innovation
  • Manias, Panics, and Crashes: A History of Financial Crises
  • The Subprime Solution: How Today's Global Financial Crisis Happened, and What to Do about It

Share This Book