A voice recognition company was in the process of IPO in the mid 1990s. They had some big purchase orders from institutional customers. The trouble was, those P

A voice recognition company was in the process of IPO in the mid 1990s. They had some big purchase orders from institutional customers. The trouble was, those POs had side letters giving the customers the right to return the products for credit if they didn't work correctly. Not disclosing those side agreements to investors was treated as felony securities fraud. It made the company seem more valuable than it really was. That's the whole dealio. Don't cook the books. Don't make stuff up. There's enough that can go wrong even if you are transparent with investors about your deals.