Mergers and acquisitions are filled with risks, some of them unavoidable. But buyers can avoid risks associated with cooked books and other forms of deceptive accounting used by a seller to distort the value of its company. Before closing an acquisition, engage a forensic accounting expert to look for fake performance figures and hidden liabilities that might turn your deal into a disaster. Something fishy When reviewing a seller’s financial statements, forensic experts look for subtle warning signs of fraud. These include: Excess inventory, Increased accounts payable and receivable combined with dropping or stagnant revenues and income, An unusually high number of voided discounts for returns, Lack of sufficient documentation in sales records, A large number of account write-offs, and Increased purchases from new vendors. Fishy revenue, cash...