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Abstract
Double-entry accounting is one of the most valuable resources within a company for both gathering information and retaining control over its operations. The accounting method and the annually published financial statements is an invaluable tool not only for shareholders and management but also governments and tax authorities. However, in its current state, it is clear that the double-entry system is limited and can be worked around. As the accounting of a company is subject to opinions and individual values, it is far from a reality and can be largely manipulated, as has been the main focus of many high-profile company scandals. The best attempts to making accounting reflect reality and aligning assumptions between companies have been regulations and international standards such as IFRS and FASB. Despite regulations and established practices, there are still limitations in accounting that allow for fraud to occur, such as the possibility of fabricated transactions and verifications.