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    This document outlines the learning objectives of a forensic accounting and fraud investigations course. It defines fraud as intentional deception that causes economic loss or gain. There are three main types of fraud: fraud in the sales/collections cycle, purchases/payments cycle, and monthly reconciliations. Other fraud types include corporate, financial statement, Ponzi schemes, customer, identity theft, and tax fraud. Occupational fraud categories are asset misappropriation, corruption, and fraudulent statements. Society perceives fraud negatively as it causes job losses, customer savings losses, and government and business losses. The social consequences of economic crime include tax losses and implications for the economy, business bankruptcies, job losses, and tax revenue losses.

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    This document outlines the learning objectives of a forensic accounting and fraud investigations course. It defines fraud as intentional deception that causes economic loss or gain. There are three main types of fraud: fraud in the sales/collections cycle, purchases/payments cycle, and monthly reconciliations. Other fraud types include corporate, financial statement, Ponzi schemes, customer, identity theft, and tax fraud. Occupational fraud categories are asset misappropriation, corruption, and fraudulent statements. Society perceives fraud negatively as it causes job losses, customer savings losses, and government and business losses. The social consequences of economic crime include tax losses and implications for the economy, business bankruptcies, job losses, and tax revenue losses.

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    4 views13 pages

    Lecture 2

    Uploaded by

    Alex Keith
    This document outlines the learning objectives of a forensic accounting and fraud investigations course. It defines fraud as intentional deception that causes economic loss or gain. There are three main types of fraud: fraud in the sales/collections cycle, purchases/payments cycle, and monthly reconciliations. Other fraud types include corporate, financial statement, Ponzi schemes, customer, identity theft, and tax fraud. Occupational fraud categories are asset misappropriation, corruption, and fraudulent statements. Society perceives fraud negatively as it causes job losses, customer savings losses, and government and business losses. The social consequences of economic crime include tax losses and implications for the economy, business bankruptcies, job losses, and tax revenue losses.

    Copyright:

    © All Rights Reserved
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    of 13

    ACC752 Forensic

    Accounting & Fraud


    Investigations
    Fraud in Society
    Learning objectives:
    1. Define fraud
    2. Explain the type of fraud
    3. Explain the other types of fraud
    4. Explain the categories of occupational
    fraud
    5. Describe society’s perception of fraud
    6. Explain the social consequences of
    economic crime
    LO1:Define fraud

    “Intentional deception, whether by omission or


    co-mission, that causes its victim to suffer an
    economic loss and/or the perpetrator to realised
    a gain”

    Simple definition:
    “ Theft by deception”
    Kranacher, et al (2011)
    Elements of Fraud
    LO2: Explain the type of fraud

    1.Sales and Collections/Receipts Cycle:


    Theft of cash or other customer payments
    Theft of other assets
    Kickbacks to customers
    Front-end frauds
    LO2: Explain the type of fraud
    cont….
    2. Purchases and Payments (Disbursements)
    Cycle:
     Personnel and Payroll Cycle
     Inventory and Warehousing Cycle
     Monthly Reconciliations and Reporting Cycle

    3
    LO3: Explain the other types of fraud

    1. Corporate Fraud in Perspective. Eg Worldcom, Enron, etc…


    2. Financial statement fraud
    3. Ponzi schemes
    4. Customer fraud
    5. Identity theft
    6. Cheque fraud
    7. Tax fraud
    8. Internet sales, etc…
    LO4: Explain the categories of
    occupational fraud

    1.Asset misappropriation
     Fraudulent Disbursements. (Five principal types)
    (i)Billings
    (ii) Expense reimbursement
    (iii) Check tampering
    (iv) Payroll
    (v) Register disbursement

    Skimming
    Cash Larceny
    LO4: Explain the categories of
    occupational fraud cont….
    2. Corruption
    “wrongful misuse of influence in a business transaction to
    procure personal benefit, contrary to an individual’s duty to his
    or her employer or the right of another. Eg kickbacks, conflict
    of interest etc…Kranacher, et al (2011)
    3. Fraudulent statements
    “Intentional misrepresentation of financial or non-financial
    information to misled others who are relying on it to make
    economic decisions. Eg. Overstating revenue, understating
    expense etc.. Kranacher, et al (2011)
    LO5: Describe society’s perception
    of fraud

     Loss of jobs

     Customer life savings

     Government losses $$$ (cannot quantify)

     Businesses losses millions $$


    LO6: Explain the social consequences of economic crime

     Tax fraud – Tax evasion & Tax avoidance


     Economy implication (loss of revenue)

     Occupational fraud
     Business bankruptcy
     Loss of employment
     Implication on Economy (e.g forgone tax revenue)
    END of CLASS

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