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:warning: LECTURE 12 IT AUDITING :warning: AUDITING FRAUD & FORENSIC …
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LECTURE 12 IT AUDITING
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AUDITING FRAUD & FORENSIC
1. Understanding Fraud
Fraud Triangle
Rationalization
justify theft
Perceived pressure
personal circumstances
Opportunity
insufficient internal controls
perpetrators circumvent controls
Fraud Characteristic
Asset misappropriation
Corruption
Fraudulent financial statements
2. Responsibility to Prevent Fraud
Fraud Prevention
Strong internal controls
Background checks
on new employees
Ethics training
for employees
Regular audit
Workplace surveillance
Establish fraud
policies
Anonymous fraud
reporting mechanisms
Willingness of companies
to prosecute
3. Forensic Auditing
Gathering evidence
Suspect identified
Obtain evidence
Interviewing
Non-threatening
Verbal, non-verbal cues
Invigilation
Strict internal controls
Compare when controls not in effect
Indirect methods of proof
Suspect financial profile
Individual lifestyles