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Fraud & Forensic Accounting
Fraud and
Forensic Accounting
Something
just doesn’t seem quite right. The financial statements are
showing a profit but there isn’t enough cash to pay all of
the bills. You begin to wonder where your bookkeeper got the
money to buy the new house. Now may be the time to have a
special review of your accounting records. Fraud reviews and
forensic accounting services are tailored engagements to
look for anomalies in accounting records. It involves an
analysis of what is recorded, as well as what is not
recorded.
Definitions
Fraud
Simple definition:
Fraud is most simply defined as a deception made for
personal gain. While there are more specific legal
meanings, they may be different from one area of the
country to another.
Legal definition:
Fraud is any crime or civil wrong for gain that uses
deception to commit the crime. Fraud occurs when a
perpetrator deliberately deceives a victim for personal
gain (i.e. to get property or services from him or her
unjustly). Fraud can be accomplished through forgery,
larceny or other methods. Fraudsters often utilize the
mail, phone or internet to commit fraud.
Acts
which may constitute criminal fraud include identity
theft, embezzlement, forgery, false billings, false
advertising, bait and switch, fause claims, Ponzi
schemes and confidence tricks.
Forensic
Accounting
Forensic
accounting is the utilization of accounting, auditing and
investigative skills to provide an analysis designed to be
suitable for use in a court of law. The resulting report may
be used as the basis for discussion, debate and dispute
resolution as well. It also is designed to communicate
financial information clearly and concisely. Forensic
accountants are trained to look past the numbers.
Certified Fraud
Examiners
Certified
Fraud Examiners (CFEs) are
professionals that have obtained a certification and are
considered to be experts in detecting and deterring fraud.
CFEs are not required to also be CPAs,
however many are.
Common
Types of Fraud
Employee Fraud
Check Kiting
Contract or Procurement Fraud
Asset Misappropriation
Embezzlement
Insurance Fraud
Tax
Fraud
Healthcare Fraud
Securities Fraud
Types
of Services
Fraud and
forensic engagements are unique. No two are the same because
no two instances of fraud are the same. Clients may want to
prosecute the perpetrator or they may want to fix the
problem and just move on. Engagement procedures are designed
for each engagement to take into account the resolution
expected by the client and the unique aspects of each
situation.
Stories
Sue Bunevich,
a Shareholder at MSL, has her
Certified Fraud Examiners license and CPA certification. Sue
was recently engaged for Fraud Examination services and
uncovered the theft of $700,000 from a company. Once the
theft was determined, Sue assisted in the recovery of the
stolen funds.
For more information on MSL's
services, call us at 1.800.683.5401 or
contact us.
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