I guess I have a pea-sized brain. While working for KPMG, first-year accountants (aka grunts) were inundated with internal controls training (alums, remember SEADOC?). But I just didn’t get it. How did/do accountants learn how to steal? If only I had these two books at my fingertips nearly 30 years earlier.
Narrative Non-Fiction, My Favorite Genre
I love the narrative non-fiction genre. To this day, American Kingpin is one of my favorite books as the storytelling is outstanding.
When it comes to accounting fraud, Cynthia Cooper’s, Extraordinary Circumstances: The Journey of a Corporate Whistleblower is must-reading for every financial leader. It’s a page-turner, and you’ll be learning along the way.
Cynthia ran Worldcom’s Internal Audit team when certain journal entries were not making sense. This was not some 3-week exercise of finding the problem and reporting it. Think closer to a year.
I highly recommend this behind-the-scenes look at how a gifted internal auditor figured out the largest accounting fraud in U.S. history.
The other title I recommend is Conspiracy of Fools by Kurt Eichenwald which is about the fall of Enron. I’ve read The Smartest Guys in the Room too, but I give the edge to Eichenwald’s account of this corporate tragedy.
Don’t Forget Financial Shenanigans
Narrative non-fiction reads like real-life fiction. That’s why the titles above are quick, page-turning reads.
Still, don’t discount Financial Shenanigans by Schilit and Perler which is more technical in nature.
In short, the book is a primer on how to spot financial statement fraud which will either build or augment your financial acumen. This can be a fast read if you take your time on the parts that interest you and skim the rest. This book belongs on your bookshelf.