NCJ Number
87293
Date Published
1981
Length
88 pages
Annotation
A steering group made up of government officials investigating the effectiveness of Swedish laws on required accounting practices found several weak points in the law concerning prosecution of cases where companies claimed inability to produce full financial records.
Abstract
It has become increasingly more common in Sweden for companies to either completely neglect their obligation to keep full accounting records or to report to authorities that their records were fully or partially destroyed accidentally. Auditing authorities who cannot obtain these financial records spend a considerable amount of resources trying to put together sufficient information to conduct an audit: the result is usually a discretionary assessment of taxes. Because of the time-consuming and difficult investigative work involved in piecing together a case against a company that has neglected to comply with the accounting law, authorities often do not prosecute or prosecute for a lesser crime. If a case is prosecuted and tried, and the offender convicted, the time between the offense and the sanction may be so long that the court is likely to pass down a sentence that is disproportionately mild. Thus, destroying records can be profitable. The steering group recommends several legislative changes. It suggests that sanctions for submitting false information, for concealing information, or for violating the obligation to keep full accounting records be spelled out in the law and that the suspected offender bear the burden of producing complete records for the authorities to prove innocence. A special sentencing scale for grave accounting crimes should be developed, and imprisonment should be allowed for accounting crimes involving particularly large amounts of money.