When Accounting Gets Creative

Featuring Robert Medd

Robert Medd exposes creative accounting at listed companies and there can be a fine line between these practices and the large scale frauds where people go to jail. Sounding concern over the legitimacy of the audit profession that signs off on behavior like debt manipulation and pension assumptions, Rob highlights how large bonuses and option schemes are being collected, while investors pay the price. Filmed on March 3, 2017 in Hong Kong.

Published on
27 April, 2017
Topic
Micro, Research
Duration
36 minutes
Asset class
Real Estate, Equities, Currencies, Crypto-currencies, Commodities, Cash, Bonds/Rates/Credit
Rating
16

Comments

  • MN

    Mark N.

    21 10 2017 22:48

    0       0

    I'm only six minutes into this and I already love it. Brilliant brilliant brilliant. Great interviewee, love the way he thinks, his passion and the way he explains things. Going to look into these guys. Well done RV!

  • HK

    H K.

    4 7 2017 18:54

    1       0

    Another interview you will never hear from the MSM, the system is very flimsy at best. Audit firms and rating agencies that are charged with this responsibility fail almost everytime!

    We need a lot more moral capitalists!!!

    Thanks RVTV

  • HK

    H K.

    4 7 2017 18:54

    0       0

    Another interview you will never hear from the MSM, the system is very flimsy at best. Audit firms and rating agencies that are charged with this responsibility fail almost everytime!

    We need a lot more moral capitalists!!!

    Thanks RVTV

  • PM

    Peter M.

    16 5 2017 06:53

    1       0

    So lets start a movement to either force all companies to report al earnings according to FASB and not skirt it by simply noting exceptions.

    Actually why bother with audit reports which are meaningless and have been for the past 20 years! This is from a retired accountant and Certified Fraud Examiner.

    After that take a swipe at Executive compensation committees and eliminate the 'standard' performance bonus scam.

  • AC

    Andrew C.

    7 5 2017 06:41

    0       0

    Excellent discussion. But Let's face it. The authorities are in on this and it will be very hard to change this system of deception and creative accounting. For example, the ratings agencies got away with it in 2008, dodgy ratings of all those assets. Their whole business was fraudulent and they should've been put out of business. Is there perhaps a website out there listing just these anomalies (without the baggage of zero hedge)? Mr Medd's examples here could easily be depicted as screenshots from the annual reports.

  • sr

    sam r.

    3 5 2017 18:03

    0       0

    Brilliant interview, loved how he explained what can be quite complex so simply.

  • PD

    Peter D.

    2 5 2017 12:15

    3       0

    This is great stuff. This guy is spot on, with one caveat: things are likely far worse than he describes. RV should definitely get him back to talk about more specific examples. Particularly in the pension, off-balance sheet and derivatives areas.

  • TH

    Timo H.

    1 5 2017 07:41

    2       1

    The biggest accounting assumptions of them all are made by the central banks. Now think about that for a moment...

  • HB

    Hector B.

    1 5 2017 06:03

    2       0

    Excellent interview. Bring him back with more time.

  • KS

    Kazi S.

    1 5 2017 05:11

    1       0

    Super interview.

  • AH

    Andreas H.

    30 4 2017 20:44

    1       0

    Super!

  • tw

    thomas w.

    30 4 2017 19:47

    1       0

    Greart - keep up the work.

  • BL

    Bruce L.

    30 4 2017 17:16

    3       0

    Bravo. This man a a new hero for me.

  • GP

    Gordon P.

    30 4 2017 16:23

    1       0

    Awesome, enjoyed listening -- thanks for showing interview

  • MA

    Mike A.

    30 4 2017 01:54

    2       0

    Entertaining , insightful, and spot on. Well worth watching.

  • GM

    Greg M.

    29 4 2017 21:05

    5       0

    Im glad they re-released the interview. Very entertaining. Could have listened to him longer.

  • ww

    will w.

    29 4 2017 12:09

    2       0

    this "creative accounting" IS Fraud! There are 2 basic legal 'elements' necessary to establish a case of fraud: 1. Deception; 2. harm caused by that deception.
    BRAVO!!! to Robert Medd. Let's agitate - early & often - for his reform suggestions.

  • PS

    Paul S.

    29 4 2017 03:24

    1       0

    With the actual numbers being fiddled so much - imagine the nonsense in the 'adjusted non-GAAP' numbers so popular now when reporting 'EPS beats'

  • DM

    Daniel M.

    28 4 2017 17:40

    5       0

    I wish he would have talked about Tesla. They definitely use some creative accounting!

  • SD

    Stephen D.

    28 4 2017 02:36

    6       0

    Oustanding! a modern Diogenes. The real point for me is that just as we get the politicians we deserve, we get the CEO's and auditors we deserve. If collectively as investors we stood us to this chicanery and sacked people who did it, via effective Board, it would cease. But our laziness and hopefulness stops us. We should all be more like Rob Medd

  • MM

    Michael M.

    27 4 2017 23:46

    1       0

    very likeable dude and interesting field.

  • PB

    Pieter B.

    18 3 2017 13:51

    3       0

    Great piece that confirms what I always thought is a conflict of interest. Thank you!

  • DT

    Dave T.

    18 3 2017 09:36

    1       0

    Perhaps it's time for Mr. Medd to turn his hand to real fiction. It would be a hoot. A great take on accounting for this non-accountant. Would like to see more.

  • sa

    sonny a.

    18 3 2017 03:44

    3       0

    Great interview!!

  • SC

    Shane C.

    18 3 2017 00:54

    2       0

    Very important for everyone esepecially deep fundamental research...love the name by the way...greatest war horse of all time

  • BF

    Bruce F.

    18 3 2017 00:19

    1       0

    a disciple of the late Abraham Brtilloff, who wrote books on the same subject. the work is essential

  • HJ

    Harry J.

    17 3 2017 20:58

    0       2

    I'm glad he's bemused. I'm sickened

  • HJ

    Harry J.

    17 3 2017 20:53

    0       2

    Not knowing who is who gives rise to a jaded view on the part of the investors

  • dd

    darrell d.

    17 3 2017 19:54

    3       0

    Being an accountant I had a chuckle about the pension liability and 3 years short deaths. We can be a sneaky bunch.

  • GG

    Gerald G.

    17 3 2017 19:19

    17       2

    Hmmm...Mr. Med says that, when looking for this kind of unethical behaviour, he identifies companies with:
    1) lots of debt
    2) that are at their peak or declining
    3) have a single powerful leader
    Does any of that sound familiar???
    HOW ABOUT THE USA dummies!!!!!
    It's sort of hard to get too outraged by any of his revelations when the US government has been "creatively" lying to the public ever since the Iraq war and now continues to do so with the reported economic "expansion" of the last 8 years.

  • CV

    Cesar V.

    17 3 2017 18:57

    9       0

    good stuff guys. As a former auditor of a big 4. I can say he was spot on in everything he said.

  • GG

    Gerald G.

    17 3 2017 18:18

    19       0

    Awesome interview but, let's face it, anyone who has being paying attention has known (for a very long time) that the entire system is rife with abuse. What I'd love to see is a recognition that this kind of "creativity" has also been pervasive in the governments reporting of the economic "expansion" since 2009.

  • HK

    Himali K.

    17 3 2017 17:41

    1       0

    Spot on for Noble Group. Very insightful.

  • SB

    Sam B.

    17 3 2017 17:37

    4       0

    Coolest forensic accountant I've ever encountered... could listen to this guy talk about anything. Reminds me not only of the Harry Markopolos interview, but also the one with Benoit Descourtieux. Both worth a look.

  • T~

    Tshort63 ~.

    17 3 2017 17:14

    9       0

    Appreciated this interview. It reminds me to be more cognizant of financial engineering, I always watch when a CFO departs and a quarter later miracles "happen" but this points out an entire new level of creative accounting. Excellent job!

  • JC

    Jan C.

    17 3 2017 17:05

    7       0

    I couldn't stop laughing at this tragic/comic presentation. If George Carlin had been a forensic accountant, this would be his presentation! Well done!

  • SS

    Sam S.

    17 3 2017 14:48

    11       0

    The fraudsters are running the world but people everywhere are pushing back. They can't hide forever, just like the sun, the moon and the truth. Excellent "real vision" discussion. More please!

  • GC

    Gary C.

    17 3 2017 14:01

    25       0

    Delighted RV is putting sunshine into the accounting world with this and the Harry Markopolus interview. Makes one pause a bit when voting to approve the accounting firm.

  • NG

    Nitin G.

    17 3 2017 11:57

    7       0

    Amazing interview !! Creative accounting is an area where we all should dip our feet in because every public company is rushing up to meet the expectations !