Cooking the Books: An Alarming Number of Controllers Feel Pressure to Misreport Financials

Can you work late this Friday? Can you be in charge of notes during this meeting? Will you start at 8 a.m. instead of 9 a.m. tomorrow?

Everyone receives requests from their company that they don’t love. And of course, sometimes employees may feel pressured to say yes even if it's inconvenient. But how often do employees feel pressure do something unsavory — potentially even illegal — for the benefit of the company?

It turns out, more often than you’d think.

In a study conducted by Dimensional Research and sponsored by FloQast, an astounding 64 percent of controllers who responded have experienced pressure to “cook the books.” This is a very concerning statistic on its own, but considering the role of the controller is to provide a clear and completely factual report of a company’s finances, this statistic is really quite alarming.

Of course, no one likes to be the bearer of bad news and controllers are no exceptions. The potential damage to company morale, stakeholders, stock prices, and self-respect if the numbers are bleak can make a controller’s job more than a little uncomfortable. This is where the pressure to gloss over or misreport those negative numbers comes from.

So who is putting this pressure on controllers and how often? Luckily, just 10 percent (!!!) of controllers say that the pressure to “cook the books” is a regular part of their job. Just over 30 percent reported in the survey that the pressure was more of an exception and not a consistent part of their work.

Sometimes management wasn’t explicit in the request. 22 percent of respondents said that it is never a direct pressure, but an unspoken expectation that the company gets the desired outcome from the finance department’s reporting.

In addition to the shocking amount of controllers who report at least some pressure to misreport financials, 89 percent of survey respondents thought the job of the company controller was becoming increasingly stressful. Top stresses included management demand for speed, a higher volume of work, and compliance demands. If only there were a way to alleviate some of those stresses.