Fraud Fraud And Fraud - 1551 Words

Fraud Detection Paper INTRO Fraud has plagued the world of accounting since the establishment of the profession. Fraud can be committed against an individual or a business. In order to identify fraud, an auditor must be able to differentiate between what is considered fraud and what is considered error. Fraud as defined in our textbook as â€Å"intentional misstatements that can be classified as fraudulent financial reporting and/or misappropriation of assets.† On the other hand, error is â€Å"unintentional misstatements or omissions of amounts or disclosures.† This simply means that fraud and error can have the same affect on a company and its books, the main difference between the two is the intent of the perpetrator. This paper will explore the basic types of fraud, preventing and detecting fraud, an example of a major fraud committed in United States history and the governments reaction to the prevalence of frauds in the 1990s and early 2000s. TYPES OF FRAUD There are three basic types of fraud perpetrated by employees. They are misappropriation of assets, bribery and corruption, and fraudulent financial reporting. Misappropriation of assets is the theft or misuse of assets that belong to a company. Misappropriation of assets is the most common type of fraud; statics show that it has occurred in over 91% of fraud schemes. It is also the simplest type of fraud to understand and commit which might explain its prevalence in many business fraud schemes. Asset misappropriation isShow MoreRelatedFraud Auditing and Different Type of Fraud2578 Words   |  11 PagesFraud Auditing and Different type of fraud Introduction Over the years, the role of auditors become increasingly important especially in a capitalist economy as the process of wealth creation and political stability depends heavily upon confidence in processes of accountability and how well the expected roles are being fulfilled. An auditor has the responsibility for the prevention, detection and reporting of fraud, other illegal acts and errors is one of the most controversial issues in auditingRead MoreThe Fraud Triangle And Fraud Scale3490 Words   |  14 PagesUse the Fraud Triangle and Fraud Scale to analyse the actions of Bernie Ebbers and Scott Sullivan. What does your analysis suggest? As Albrecht et al. (2012) illustrate, there are many ways to commit fraud but common to all frauds are the following three elements, which make up the fraud triangle: 1. A perceived pressure 2. A perceived opportunity 3. A rationalization of the fraud as acceptable These three elements are almost always present in every fraud and are interactive. This gives rise toRead MoreAccounting Fraud And The Financial Fraud1761 Words   |  8 Pagesthose investing in the company that Ebbers wasn’t the best choice to run the 2nd biggest telecom company in America. WorldCom was just one of many accounting frauds that took place in the early 2000’s. But unfortunately that trend of dishonest accounting didn’t stop. The reason behind writing this report is to examine the $11 billion accounting fraud the biggest in US history, the collusion between Ebbers and the CFO Scott Sullivan to deceive investors, causing the loss of thousands of jobs and costingRead MoreFraud, Corruption, Theft, Misappropriation, And Fraud1738 Words   |  7 PagesThere is no specific definition for fraud if looked at from different perspectives. The term fraud is used to describe acts such as deception, corruption, theft, misappropriation, false presentation, brib ery, fault partnership, forgery etc. Some may even describe fraud as practical process of deception to gain an advantage, or to cause loss to another entity or individual. While some people might not even anticipate to commit fraud, others might do so if they contemplate they have a way to be covertRead MoreFinancial Statement Fraud And Corporate Financial Fraud1310 Words   |  6 PagesFinancial Statement Fraud Background Financial statement fraud is one of the biggest types of fraud in today’s business world. The complexity and mechanism of financial statement fraud brought the attention of auditors and regulators. Financial scandals of Enron, WorldCom, Xerox, Tyco, Parmalat, Qwest, and Satam Computers increased the auditors’ responsibility in detecting and preventing fraudulent transactions. Corporate financial fraud had negative consequences for the market capitalization dueRead MoreConsumer Fraud1004 Words   |  5 PagesPaper When consumers engage in fraud, they attempt to deceive businesses for their personal gain or when a consumer intentional deceives an organization by taking an economic advantage over them (insert bibliography 1 ). There are multiple ways a consumer can deceive a business. Some examples include identity theft; check fraud, credit card fraud and shoplifting. Employees, consumers, and businesses can do fraud in many ways. Consumers have achieved consumer fraud by improving and changing waysRead MoreCorporate Fraud Is A Big Part Of The Fraud1967 Words   |  8 Pagesall forms of fraud. There are a vast amount of fraud types out in the world today that some of us may not have even realized yet. With the immense amount of fraud that is occurring, how could so many people get away with committing it? The answer is there is too much fraud occurring for anyone to look into the smaller fraudulent acts. There are specifically two types of frauds that occur that focus a lot on the business aspect, Corporate and small business fraud. Small business fraud tends to appearRead More Fraud: Early Warning Signs of Fraud Essay2710 Words   |  11 PagesA Ponzi scheme is a type of fraud called investment fraud. It, â€Å"involves the payment of purported returns to existing investors from funds contributed by new investors† (6). Investors are usually promised a high return rate. The fraudsters attract new investors and pay back their old investors with the new investor’s money. Ponzi schemes are named after Charles Ponzi who created scheme by getting residents to invest in a postage stamp scheme. Bernie Madoff is a well known and not well liked PonziRead MoreInternet Fraud2358 Words   |  10 Pagescountries. There are now over 50 million people online. All kinds of information are available through the Internet at less cost or no cost at all. The Internet provides facts and ideas that are useful for the society, but the Internet is also a tool for fraud. The Internet â€Å"is a system of linked computer networks, worldwide in scope that facilities data communication services such as remote login, file transfer, electronic mail, and news group. The Internet is a ways of connecting existing computerRead MoreFinancial Fraud, And Identification Of The Different Fraud Types1734 Words   |  7 Pagesvarious types of fraud, in order to aid understanding in regards to the prevention of fraudulent activity. This paper begins with a review of the definition of financial fraud, and identification of the different fraud types. Further, included is an examination of what motivates individuals to commit fraud, including an identification of some of the method in which people commit fraud. A discussion of the importance of the fraud triangle, and how rationalization contributes to fraud is a key area