Fraud schemes 4-5 pages (excluding title page, abstract, references, or appendices)

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Business Finance

Description

For this assignment, you will prepare a report that documents your analysis of the financial fraud, and you should explain the results from your evaluation of the internal controls that were exploited. Complete the following for this assignment:

  • Analyze a documented case of financial fraud.
  • Evaluate the internal control system's weaknesses and vulnerabilities that were exploited in the commission of the fraud.

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Explanation & Answer

Attached.

Running head: FINANCIAL FRAUD SCHEMES

Financial Fraud Schemes
Name
Institution
Date

1

2

FINANCIAL FRAUD SCHEMES
Introduction

Financial fraud schemes are very common in financial institutions and they mostly tend to
affect the financial statements. The Association of Certified Fraud Examiners (ACFE) produces
an annual report explaining the level of fraud in different industries that contribute to the economy
(LaRowe, 2015). This paper shall mainly analyze the documented case of financial fraud and also
evaluate the weaknesses and vulnerabilities in the internal control system that led to the
commission of the financial fraud.
Documented Case of Financial Fraud
Financial fraud is committed in an effort to fulfill the financial needs of greedy employees.
ACFE report analyses the level of fraud cases in different industries and the various methods used
to detect the fraud. There are several methods used to detect the operational frauds (LaRowe,
2015). The methods include; tip, management review, internal audit, by accident, account
reconciliation, document reconciliation, external audit, surveillance or monitoring, notification by
law enforcement, IT controls and confession by an individual who has committed the fraud. The
tip is the method that is mostly used in the detection of frauds while confession by the individual
committing the fraud is the least method of detecting fraud. Potential fraud can be detected by
employees, customers, vendors, shareholders, and competitors (Wells, 2008). All companies in
different industr...


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