In financial statement fraud, what often happens to overall company performance?

In cases of financial statement fraud, the overall company performance is often potentially overstated or understated. This manipulation occurs when management intentionally distorts financial information to present a more favorable or misleading view of the company's financial health. For instance, revenues might be inflated to make the company appear more profitable than it truly is, or expenses might be understated to enhance profit margins.

These adjustments can create a distorted view of performance that misleads investors, creditors, and other stakeholders about the true financial condition of the company. Such actions can have significant implications, including impacts on stock prices, market perception, and the company's ability to raise capital. The potential for misrepresentation makes "potentially overstated or understated" the most accurate description of what often happens to a company's reported performance in the context of financial statement fraud.