Which of the following is a common reason for committing financial statement fraud?

One common reason for committing financial statement fraud is to obtain favorable terms on financing. Companies may feel pressure to show better financial performance than what is actually reflected in their books. By manipulating financial statements to appear more favorable, organizations can secure loans or attract investors under terms that would otherwise not be possible. Lenders and investors often rely on these statements to assess the financial health and performance of a business, so presenting a distorted image can lead to more favorable interest rates, larger credit lines, or investment opportunities.

This type of fraud typically involves overstating revenues, understating liabilities, or manipulating earnings to present a robust financial position. The underlying motive is primarily economic, driven by the necessity of access to capital for growth or operational stability. Thus, the intention is to enhance the company's appeal to creditors and investors, which ultimately serves the fraudulent entity's financial goals.