In each of the following examples, I need assistance identify whether it is an employee embezzlement, management fraud, investment scam, vendor fraud, customer fraud, or miscellaneous fraud.
Marcus bought a $70 basketball for only $30, simply by exchanging the price tags before purchasing the ball.
Craig lost $500 by investing in a multilevel marketing scam.
The Bank of San Felipe lost over $20,000 in 2008. One of its employees took money from a wealthy customer's account and put it into his own account. By the time the fraud was detected, the employee had spent the money and the bank was held responsible.
The CEO of Los Andes Real Estate was fined and sentenced to six months in prison for deceiving investors into believing it made a profit in 2008, when it actually lost over $150 million.
The government lost over $50 million in 2008 because many of its contractors and subcontractors charged for fictitious hours and equipment on a project in the Middle East.
A student broke into the school's computer system and changed his grades in order to be accepted into graduate school.© BrainMass Inc. brainmass.com October 25, 2018, 4:51 am ad1c9bdddf
1. Customer fraud - by switching the price tags.
2. He fell prey to an investment scam, there ...
The solution provides the answers for what type of fraud is present in each scenario listed. Types of frauds include employee embezzlement, management fraud, investment scam, vendor fraud, customer fraud, or miscellaneous fraud. The scenarios are answered correctly based on law, and from my experience as a fraud investigator.
Statement of Audit Standard 70 - Service Organization audit is an audit on organizations that provide various service to other businesses which, for different reasons may decided to outsource one or more of their activities.
During annual audit of companies that have outsourced part of their activities, the external auditor needs assurance that the controls in place at the third-party service provider are effective. SAS 70 report will provide such assurance.
Consider Type I and Type II SAS reports. Do both of these reports allow the reduction of substantive testing?
It is important to talk a little bit about SAS 99 - Consideration of Fraud in a Financial Statement Auditing. This standard provides extended description of fraud and requirements auditors need to fulfill for fraud detection and during audit engagement.
I find the topic that deals with Professional Skepticism interesting. Professional Skepticism is different from suspecting the presence of fraudulent activity. It is rather recognition that fraud is possible hence preparing one's attitude accordingly.
Additional thoughts on SAS 99
The importance of IT auditors while engaging in audit of an organization with computerized Accounting Information System.
However, many systems have built-in procedures to produce different reports including supporting documentation, journals, and ledgers. Auditors can us the the print outs of these reports with having to deal with the actual computer system and its controls. This is called Auditing Around the Computer.
Any thoughts on the other two - Auditing Through the computer and Auditing With the Computer?View Full Posting Details