Those with long memories - and in this forum, the few that can pass that cut might include
@jbcarioca and....well, not many others from the world of business - might remember the case of Billy Sol Estes. In the early 1960s, he was lauded as a
wunderkind up-by-the-bootstraps businessman, having cornered just about every facet of the heavy equipment market - construction and agriculture - in a vast swath of Texas. He did this by showing lending agencies all his equipment all over the state. Billy Sol Estes garnered many "Businessman of the Year" type awards.
Except - it was all the same equipment, that his team kept shuffling to the next site just ahead of the moneybags' visits. I believe auditors got a lot stricter after that particular Emperor was shown to have Very Few Clothes. Here's some from his obit:
Billie Sol Estes, Texas Con Man Whose Fall Shook Up Washington, Dies at 88
Here's another from my own corner of the world. Fortunately for my sake, I am not knowingly related to anyone on either side of this story. But it shows how an auditor can not be expected to keep ahead of someone with mischievous intentions. From 1930s New Hampshire:
A particular logger/landowner was interested in divesting. So he showed a particular stretch of forest to an interested party, and they looked upon fine pine after particular fine pine. A very appealing amount of high quality board feet, and a deal was struck.
If you've guessed the punch line, you're right. Never trust a New Englander familiar with his own tortuous terrain not to run you around Robin Hood's barn showing you the same set of trees multiple times.
So: pulling the wool over others' eyes is a long and dishonorable tradition. Sometimes audits will find discrepancies -
most of these, however, will be mathematical errors or judgmental disputes. It can be supremely difficult to uncover the shenanigans of those with mischievous intent.