# Management's financial manipulation to conceal corruption Management may use control of the company's financial functions to conceal corrupt activities, mainly in the following ways： ## Manipulation of financial statements -Artificially adjust the revenue recognition time -Fictitious or exaggerated income -Hidden or underreported fees -Improper capitalization (recording expenses as assets) ## Internal control exploit -Bypass the approval process -Establish a "shadow system" to handle illegal transactions -Decentralize large transactions into multiple small transactions to avoid censorship -Exploit the loophole of insufficient separation of responsibilities ## Related party transaction -Set up a shell company to conduct false transactions -Convey benefits to the company through executives' relatives and friends -Non-disclosure or partial disclosure of related-party transactions ## Document and record manipulation -Tampering with financial documents -Destroy key evidence -Forged approval signatures and vouchers Preventing these behaviors requires a strong corporate governance structure, an independent audit committee, and an effective reporting mechanism.