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And that would be in itself criminogenic: Schneier on Security: Control Fraud
"Systems capacity" theory examines why under deterrence is so common. It shows that, particularly with respect to elite crimes, anti-fraud resources and willpower are commonly so limited that "crime pays." When systems capacity limitations are severe a "criminogenic environment" arises and crime increases. When a criminogenic environment for control fraud occurs it can produce a wave of control fraud. "Neutralization" theory explores how criminals neutralize moral and social barriers that reduce crime by constraining our decision-making to honest enterprises. The easier individuals are able to neutralize such social restraints, the greater the incidence of crime.
"Neutralization" theory explores how criminals neutralize moral and social barriers that reduce crime by constraining our decision-making to honest enterprises. The easier individuals are able to neutralize such social restraints, the greater the incidence of crime.
But this requires a truthful and reasonably accurate picture of the cash flow, which is why you have to police the auditors that audit the cash flow statements.
Friends come and go. Enemies accumulate.
Besides, you can't borrow against future cash flow without paper trails. So large and medium-sized firms have an incentive to keep an audit-able paper trail. Particularly if you audit the banks to make sure that the money they issue is backed by an auditable future cash flow.
Small business have cashflows in cash. But small businesses don't do control fraud or aggressive accounting. They do conventional man-with-suitcase fraud, or simply don't disclose their incomes.
I do think this explains why VAT evasion is so prevalent among small businesses in Spain.
A sole proprietorship or family business is a control fraud waiting to happen.
I have lately thought that, if ordinary small businesses are control frauds where poor performance and graft by the owners are normal, it cannot be too hard to run a business profitably. If you don't steal from your own business it should be easier to keep it running.
Economics is politics by other means
IF it is accurate we've got a fact of no mean importance.
She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
Ramsey travels the US and helps restaurants on the brink of bankrupcy. 9 out of 10 times the problems are well known to the staff but the owner is to stubborn to listen.
Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
Ramsey travels the USmostly England and helps restaurants on the brink of bankrupcy
Kitchen Nightmares is an American reality television series on the Fox network, in which Chef Gordon Ramsay spends a week with a failing restaurant in an attempt to revive the business. It is based on the British show Ramsay's Kitchen Nightmares.
* Which they do.
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