For the chief financial officer and controller, red flags to watch for:
1 Controlling or domineering management personalities.
2 Significant and/or subjective judgment in estimates.
3 Frequent changes to estimate procedures.
4 Unexpected areas of profitability.
5 Recurring negative cash flows during periods of earnings growth.
6 Omissions or inaccuracies in financial data.
7 Revenue reported after established cut-off periods.
8 Rapid growth compared to peers.
9 "Abnormal" pressure or involvement of management in selection of accounting principles.
10 Write-offs for loans 1, provided to directors, officers and management.
Examples of red flags for treasury and corporate finance are:
1 Financing that requires "quid pro quo" relationships.
2 Requests to establish bank accounts in nonoperational locations.
3 Excessive number or frequent changes in bank accounts.
4 Frequent reallocation of funds...