🕯️ [INT. FINACADEMICS OFFICE – DAYTIME]
Holmes and Watson are at their usual spot—Holmes at the desk, Watson by the window. A projector beams financial statements onto the wall, illuminating the room with eerie white light.

WATSON:
The profit margins seem to be shrinking, Holmes. Sales are up, costs are stable, but the bottom line is as thin as my patience during tax season.

HOLMES:
Ah, Watson, you know what they say—where there’s smoke, there’s fire. And in finance, if the profits are vanishing, someone might be stoking their own chimney.

WATSON:
You suspect foul play in the payroll?

HOLMES:
Precisely. Look at this: Sales grew by 20%, costs remained flat, but profits fell by 15%. If this company were a bakery, someone’s been eating all the pies.

WATSON:
Could it be executive compensation? You think they’re awarding themselves with golden parachutes while the business is skydiving?

HOLMES:
An astute observation, Watson! Executive compensation has ballooned by 50%. It’s the classic salary slip-up—when executives reward themselves for performance that exists only in their imagination.

WATSON:
How do we prove it?

HOLMES:
Simple. We compare compensation growth with profit growth. Genuine leadership leads to shared success. But when paychecks soar while profits shrink, it’s like giving the captain a medal while the ship is sinking.

WATSON:
Diabolical! So they’re stuffing their pockets while shareholders are left with crumbs?

HOLMES:
Precisely. As I always say, Watson, ‘When in doubt, follow the money.’ And in this case, the money led straight to the executive suite—where the salaries are high and the ethics are low.

WATSON:
Shall we blow the whistle, then?

HOLMES:
Indeed. Let’s give them a dose of reality. We’ll show the board how the company’s treasure was siphoned off as compensation, leaving nothing but an empty chest.

WATSON:
Another case closed. And this time, I’ll keep a closer eye on my own payslip. You never know when a slip-up might hit closer to home!

📊 Financial Forensics Table

🚩 Red Flags to Investigate

• Executive pay rising significantly faster than earnings
• Disconnection between performance metrics and compensation
• Excessive bonuses tied to revenue, not profitability
• Lack of shareholder oversight or compensation committees

📚 Real-Life Case File: Tyco International

In the early 2000s, Tyco’s CEO and CFO were convicted of awarding themselves over $150 million in unauthorized bonuses and perks—private islands, apartments, and even a $6,000 shower curtain. Meanwhile, Tyco’s stock plummeted, and shareholders bore the brunt of the deception. It’s a classic case of executive compensation abuse hidden in plain sight.

Other infamous examples include WorldCom and Enron—where executive enrichment masked larger structural problems, misleading analysts and investors until collapse was unavoidable.

🛡️ Mitigation Tactics

• Implement transparent compensation policies tied to EBITDA or free cash flow, not revenue.
• Mandatory shareholder approval for C-suite pay raises above market benchmarks.
• Independent compensation committees with forensic accounting support.
• Clawback clauses for inflated bonuses based on restated earnings.

🧠 Detective’s Note: Compensation should mirror contribution. When paychecks grow faster than performance, don’t ignore it—investigate it.

“There is nothing more deceptive than an obvious fact.”
– Sherlock Holmes, The Boscombe Valley Mystery