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Concideration of fraud in an audit
Finance & Accounting
Pages 6 (1506 words)
Consideration of Fraud in an Audit Name University Consideration of Fraud in an Audit INTRODUCTION: The corporate world has recently faced large corporate scandals. These relate to fraudulent activities in an organization which had caused losses of billions of dollars to public.
FRAUD Fraud is a word used in broader concepts and approaches. It basically refers to any illegal action characterized by deceit and concealment which isn’t conducted under any violence, force or threat. The aim of every fraudulent activity is an undue advantage which could be institutional or personal. (Flostoiu.2012) Characteristics of Fraud: Fraud results in victim that loses a benefit because of the criminal’s fraud. It is represented by a series of illegal actions and irregularities which are all planned with the intention to deceive. Fraud is also referred to activities which involve concealment of information that was to be revealed by an obligation and intended omission of certain information or documents including misstatements and misrepresentation of information. Fraud also includes falsification of financial situations, corruption and theft. It is always important to distinguish between a fraud and error. The results of both error and fraud could be the same, but fraud is committed intentionally while error happens unintentionally. (Flostoiu.2012) Fraud Triangle Theory: A fraud triangle is a model which discloses the factors found in fraudsters at all levels of organization. This theory researched about the factors that force honest people to commit fraud. ...
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