...Running head: Certified Fraud Examiner Written Assignment: Certified Fraud Examiner Christina Berrios Advanced Auditing Concepts and Standards Tiffany Krogman 2/8/15 Certified Fraud Examiner The Association of Certified Fraud Examiners is the world’s largest anti-fraud organization and premier provider of anti-fraud training and education. It is their mission “to reduce the incidence of fraud and white-collar crime and to assist the Membership in fraud detection and deterrence” (AFCE). Membership and certification are no easy task as both require an individual to meet certain qualifications as well as pass the CFE exam. It is these qualifications and standards, however that make a CFE an invaluable asset both on an internal and external level. The prerequisites for CFE membership include having AFCE membership in good standing, fulfillment of minimum academic and professional requirements, high moral character and agreement to abide by the Bylaws and Code of Professional Ethics of the Association of Certified Fraud Examiners (AFCE). After meeting the prerequisites, qualifying individuals must then pass the CFE exam and gain final approval from the certification committee to complete the membership and certification process. The AFCE also uses a point system as means of determining whether an individual is eligible for certification. Points are distributed based on education, professional affiliations and experience. The...
Words: 490 - Pages: 2
...Systems Audit and Control Association. All rights reserved. www.isaca.org. How to Use a New Computer Audit Fraud Prevention and Detection Tool By Richard B. Lanza, CPA, PMP W hile occupational fraud takes various forms, the result is always the same: the numbers generated by fraud cannot hold up to the unfailing logic of the accounting equation. If executives add false sales and accounts receivable to increase the organization’s revenue, profits and cash will be out of kilter. The advancement of technology has allowed for this “accounting equation” to be systematized into computer logic and applied to company data.1 Results of this logic could take the form of a simple matching of the human resource file to the accounts payable vendor master file. On the other side of the coin, it could be an advanced neural network application focused on detecting money laundering schemes. Whether it is simple or advanced, data analysis provides many benefits in the prevention and detection of fraud. On one hand, the fraud examiner gains insight on 100 percent of an organization’s transaction data vs. more limited manual methods of selection. Further, this approach can generally be completed in less time than manual procedures, given the automation of the work. Examiners also gain improved business intelligence as the generated reports often lead to conclusions beyond whether just fraud occurred. Such new insights can lead to suggested process improvements to the client. The Institute of Internal...
Words: 2941 - Pages: 12
...the tax impact of various corporate strategies. And a Forensic Accounting is the examination of financial records that will lead to or result from litigation. The results of a forensic accounting investigation can be used as evidence in court, and so are usually heavily documented. With the ever-changing US tax code and the increased scrutiny that business is beginning to face, due to things like the Sarbanes-Oxley Act, these two areas can be the difference between jail and smooth operation. Forensic Accounting is a field that I researched more in-depth. The academic skills necessary for a career in forensic accounting are similar to any other accounting job. One would need a degree in accounting, a CPA, and often need to be a Certified Fraud Examiner. With the high earning potential of this field, many organizations look for extensive education. A master’s degree and many different certifications aren’t...
Words: 1026 - Pages: 5
...Institute of Internal Auditors code states that auditors will keep all information confidential unless there is a professional or legal obligation to otherwise disclose the information. The Association of Certified Fraud Examiners code states that examiners will not disclose confidential information without the proper authorizations to do so. A second way the codes complement each other is through competence. Both the Institute of Internal Auditors and The Association of Certified Fraud Examiners state that they will continue to increase the competency of their members. Other ways in which they complement each other, both declare their allegiance to integrity, professionalism, and to maintain both ethical and legal conduct. The codes of ethics are essentially the same for each organization, all though the wording is a bit different between the two codes. Standards are important in both fields, so that auditors and fraud examiners have a uniform and legal approach to handle the risks inherent in organizations. Standards are important for fraud examiners so that they have uniform way of obtaining documentary evidence, interviewing witnesses and potential suspects, writing investigative reports, testifying to findings, and assisting in the general detection and prevention of fraud. Standards are important to internal auditors in similar ways but more specifically they are important in meeting the responsibilities of the internal auditor and internal audit activity. Both codes...
Words: 405 - Pages: 2
...learning knowledge in a discussion topic of defining forensic accounting; I will be sharing with you my life knowledge in key specific areas within the fraud examination. I will also discuss my views of what is forensic accounting and its importance of this field. In addition; I will be delving in my definition of the fraud triangle and how I would utilize it in today cases. Going forward, I will explain the importance of the fraud triangle in fraud examination cases as well as I will give an explanation on my belief of how the fraud examination has an inevitable part today and along with how it works at the same point in time. I will finalize this discussion with the requirements needed to become a forensic accountant in the present state of Florida that I reside in. Definition of Forensic Accounting Forensic, a word that ignites the search for clues to find the perpetrator 's intent and truth in a criminal case. In the topic of forensic accounting, it brought to my attention of a T.V. show that I have recently watched a few nights ago. The show was called Forensic Files on the HLN network. The particular case was about on how investigators of a police department were working on a murder case. They were working with different specialized groups of examiners, doctors and specialists to help solve how the death of a man occurred. During the investigation, a key item was discovered that gave the factual time and...
Words: 1761 - Pages: 8
...Joseph Wellington a certified fraud examiner has requested help in reviewing cases that involve identity theft of University Professors. A Certified fraud examiner is one that investigates possible illegal activity. He or She will review and analyze documentation and interviews of suspects and help to work out the facts and details of a fraud claim. Along with this they will help to set up training and guidelines for employers and employees to prevent fraud. They receive their training and certification by the Association of Certified Fraud Examiners. This is one of the largest organizations that is anti-fraud and provides education. (ACFE Association of Certified Examiners, 2013) Identity theft is the act of gaining advantage over a victim by acquiring information that is used to commit a crime or an act of fraud. In our digital age it is very easy to gain personal data on the internet.. All open environments such as schools, social media, and work store data that can be used deceptively in the hand of the wrong person. Our plan is to first analyze and gather data that can be used to examine the Professor's case. . Most people who commit an act of fraud are not career criminals but are often trusted staff or family members and sometimes friends who have no criminal history. A possible motive might be gained from listing the gain or loss by each of the parties that might have some hidden agenda or causes. Finding timelines of occurrences and location of events and information...
Words: 731 - Pages: 3
...Fraud Detection Using Two Types of Analysis Tyler Mandley ACT510 - 1 – Forensic Accounting and Fraud Examination Colorado State University – Global Campus Dr. Karina Kasztelnik March 6, 2016 Fraud Detection According to a study conducted by the Association of Certified Fraud Examiners (ACFE), fraudulent financial statement accounts for approximately 10% of incidents concerning white collar crime (2009). In order to prevent this number from increasing, fraud examiners, employees, and management need to detect fraud early and prevent it. Financial Statement Fraud Falsifying financial statements involves the manipulation of financial accounts by overstating assets, sales and profit, or understating liabilities, expenses or losses. By using either trend analysis and/or financial statement analysis, one can detect fraud and anomalies. The statement of cash flows shows the cash inflows and cash outflows during a period. The statement details the net increase or decrease in cash as a result of operations, investment activities, and financing activities. Possible Fraud A company will want to build inventory to anticipate future sales, and in doing so, tries to meet the increase in sales with that of inventory growth. A possible reason for inventory that is growing at a faster pace than sales might indicate obsolete, slow-moving merchandise or overstated inventory. I believe in this case, most likely, fraud is occurring due to the significant difference between the two...
Words: 956 - Pages: 4
...The Washington State Board of Accountancy has specific education requirements that are current after July 2000. In order to be eligible to take the CPA exam, a person must have a Bachelor’s degree or higher and must have completed at least 150 semester credits of college education (Board of Accountancy Washington State). Within these 150 semester credits, 24 credits must be in accounting subjects with 15 credits at the upper or graduate level and 24 credits must be in business administration subjects (Board of Accountancy Washington State). The Board must also recognize your school as an accredited college. If your education was outside of the United States or was received from a non-accredited US college or university, the education has to be evaluated by a recognized evaluation service (Board of Accountancy Washington State). The CPA exam consists of multiple choice questions, written communication, and task based simulations. There are two sections to the CPA exam: the content specification outlines (CSOs) which covers auditing and attestation, financial accounting and reporting, regulation, and business environment and concepts; and the skill specification outlines (SSOs) which covers knowledge and understanding, application of the knowledge, and written communication (American Institute of CPAs, 2013). The auditing and attestation section of the CSOs covers auditing standards for public and non-public entities, government entities, and not-for-profit entities. It also covers...
Words: 1485 - Pages: 6
...Institute of Internal Auditors code states that auditors will keep all information confidential unless there is a professional or legal obligation to otherwise disclose the information. The Association of Certified Fraud Examiners code states that examiners will not disclose confidential information without the proper authorizations to do so. A second way the codes complement each other is through competence. Both the Institute of Internal Auditors and The Association of Certified Fraud Examiners state that they will continue to increase the competency of their members. Other ways in which they complement each other, both declare their allegiance to integrity, professionalism, and to maintain both ethical and legal conduct. The codes of ethics are essentially the same for each organization, all though the wording is a bit different between the two codes. Standards are important in both fields, so that auditors and fraud examiners have a uniform and legal approach to handle the risks inherent in organizations. Standards are important for fraud examiners so that they have uniform way of obtaining documentary evidence, interviewing witnesses and potential suspects, writing investigative reports, testifying to findings, and assisting in the general detection and prevention of fraud. Standards are important to internal auditors in similar ways but more specifically they are important in meeting the responsibilities of the internal auditor and internal audit activity. Both codes complement...
Words: 291 - Pages: 2
...FORENSIC AUDITING As stated by Gordon Brown, the former Prime Mister of the United Kingdom, “what the use of fingerprints was to the 19th century and DNA analysis was to the 20th century, forensic accounting will be to the 21st century”. When people first see the word “forensic”, they naturally categorize it into a science-related field. According to Webster’s Dictionary, the term “forensic” is defined as “belonging to, used in, or suitable to courts of judicature or to public discussions and debate”. Therefore, forensic accounting is generally defined as relating and applying financial facts to legal problems (Singleton and Singleton 12). Forensic accounting consists of a combination of the techniques that are used in accounting, auditing, and investigative work. The focus of this paper is on the concept of forensic auditing; however, forensic auditing cannot be fully understood without incorporating all of the facts about forensic accounting. Most situations that involve forensic auditing will deal with proposed fraudulent activities, but there are some cases that may deal with non-fraudulent activities, such as settlements of monetary disputes (“Student Accountant”). Throughout this paper, we will discuss, in detail, the profession of forensic auditing and forensic accounting in relation to fraudulent activities. What is Forensic Auditing? Forensic auditing and financial auditing are not related in any way; rather, they have their own distinct objectives that are set...
Words: 3839 - Pages: 16
...Use the Fraud Triangle and Fraud Scale to critically analyse the actions of Bernie Ebbers and Scott Sullivan during the WorldCom saga/ What does your analysis suggest? Dennis Greer’s fraud triangle is a key framework in analysing the ‘factors that cause someone to commit occupational fraud’ (ACFE-The Fraud Triangle, Association of Certified Fraud, Examiners Available from:http://www.acfe.com/fraud-triangle.aspx [January 2014]). The three elements that make up the model are perceived pressure, perceived opportunity and rationalisation. In reference to the events of WorldCom, which has been labelled to date, ‘one of the biggest accounting scandals in history’ (CNN Money- WorldCom’s Financial Bomb, Available from:http://money.cnn.com/2002/06/25/news/worldcom/. [June 2002]) the initial pressures that were the driving force behind the actions of CEO, Bernie Ebbers and CFO Scott Sullivan are quite vast. Firstly Ebbers, was faced with the managerial strain of financial pressure on management due to the decline in the economic environment and the high expectations of Wall Street. As a result, he was aware that the key to growth was in acquisition and mergers, which required an illusion of a solid investment portfolio and therefore ‘a heavy dependence on the performance of WorldCom shares’ (Forbes- Bernie Ebbers Guilty, Available from: http:// www.forbes.com/2005/03/15/cx_da_0315ebbersguilty). In addition, Ebbers was fuelled by greed, ‘nearly a billionaire’...
Words: 3980 - Pages: 16
...The Journey of Accounting The employment for accountants and auditors is expected to grow by twenty percent between 2008 and 2018, which is much faster than the average for all occupations (“U.S. Bureau of Labor Statistics” 5). This shows that accounting is a profession that is very dependable to get a job in. Accounting has been around for ages as it can be traced back to Italy in the Renaissance Era. Accountant’s nature of work is to make sure that business firms run efficiently, public records are kept accurately, and taxes are paid properly and on time (1). Accounting refers to a set of business practices designed to keep careful track of accounts, funds, and transactions between a company and its various stakeholders. The system we use today to track money in business was invented in Italy during the Renaissance. An Italian merchant invented it so that he could easily summarize his results at the end of the day. The system had a simple system of checks and balances to make sure that everything he had recorded was done correctly. The Italian merchant called his system the double-entry accounting system, and it was very simple to understand (Hart 4-5). His name was Luca Pacioli, born in Sansepulcro, Tuscany. Pacioli is known as “The Father of Accounting”. Later on, as trade increased between Europe and the Middle East, business grew beyond what a single owner could even handle. This caused the need for written records so that the business owners could keep up...
Words: 3357 - Pages: 14
...Case Study – FOR THIS MAGAZINE, INTERNAL AUDIT PROVED HARD TO DIGEST Janet Leonard AC 562 – Auditing: An Operational and Internal Perspective Including Fraud Examination This case revolves around the globally renowned company, Reader’s Digest. Best known for its popular magazine of the same name, the company is one of the world’s largest direct-mail publishing houses. As with other global companies, Reader’s Digest made a decision in the mid-1980’s to outsource a large portion of its direct-mail business to specialized mailing companies. Its Pleasantville, New York facility was to be converted into an office complex, complete with auditorium. The company hired Terrence McGrane as its chief internal auditor. Mr. McGrane set up meetings with the company’s vice presidents in an effort to learn more about the company. In an effort to learn the accounts coding system, Mr. McGrane borrowed some recently processed invoices from the accounting department. He then proceeded to his first scheduled meeting with the vice president of administrative services, Mr. Harold Scott. Part of Mr. Scott’s duties involved the oversight of construction projects, as well as maintenance services. According to the Association of Certified Fraud Examiners’ 2006 Report to the Nation, 25% of all fraud in large businesses is discovered by accident. Such was the case with Reader’s Digest. When Mr. McGrane showed Mr. Scott the invoices he had retrieved from accounting, Mr. Scott...
Words: 1136 - Pages: 5
...Submit a 3 page paper that 1) explains the difference between litigating an embezzlement case in civil court and criminal court, and 2) discuss the role of an expert witness/fraud examiner in each proceeding. There are two major factions of the United States court system: civil cases and criminal cases. Both take place in courtrooms all across the country, but there are several differences that separate the two as well as the role of fraud examiner in each proceeding. The major difference of the two in an embezzlement case is: 1) In a criminal court case, the opposing parties are the prosecutor, often the Assistant District Attorney, and the defendant, represented by a trial lawyer. In a civil court case, however, the opposing parties are the plaintiff and the defendant, both of whom are typically represented by attorneys. 2) In a criminal court case, the prosecutor must establish the guilt of the defendant, but in a civil court case, the plaintiff must only establish the liability of the defendant. In the former, the defendant is either guilty or not guilty of a crime, while in the latter, the defendant is either liable or not liable for monetary damages suffered by the plaintiff. For example, in a criminal court case, the defendant can be found guilty of money laundry his money, while in a civil court case, the defendant can be found liable for stealing someone’s car. In civil court cases, the plaintiff must only win by a preponderance of evidence, which means that the defendant...
Words: 1711 - Pages: 7
...securities industry throughout his long career. He once served as a vice chairman of NASD, a member of its board of governors, and a chairman of its New York region. Also, he was a member of the NASDAQ Stock Market board of governors and its executive committee and served as a chairman of the trading committee. His own investment advisory firm, Bernard L. Madoff Investment Securities LLC, was founded in 1960. A Ponzi scheme is “an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors.” (US SEC, 2012) The organizers of such schemes, promise to invest their funds properly into new opportunities that have the chance to generate high returns with little to risk. Usually, the organizers look for new investors to make the promised payouts to those early stage investors. They can also use this money for personal expenses, instead of using it legitimately for investment activity. In 2008, the Securities Exchange Commission found Bernie Madoff and his investment firm guilty of securities fraud for the multi-billion dollar Ponzi scheme he ran on clients of his firm for years. “The SEC filed emergency motions to freeze assets and appoint a receiver, and worked to return as much money as possible to harmed investors.” US SEC. (2012) Madoff is now serving a 150-year sentence in a federal prison. However, Bernie Madoff’s Ponzi scheme was a bit different than most. Unlike most other Ponzi schemes, “Madoff did not promise spectacular...
Words: 1231 - Pages: 5
