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10 Cards in this Set
- Front
- Back
- 3rd side (hint)
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Financial statement fraud cases usually contain all of the following recurring themes... |
Pressure on senior management to meet goals; no whistleblowers; aggressive accounting practices |
Not separation of duties |
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Joseph Wells, the founder and Chairman of the Association of Certified Fraud Examiners, has said that the best deterrent to fraud in an organization is |
The perception of detection |
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One of the clearest effects of SOX, as pointed out in the 2004 survey of public executives by Foley & Ladner LLP, has been on the relationship between |
The external auditor and the management |
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The following are examples of cooking the books... |
Overstating inventory; holding December liabilities until January; recording revenue before it is realized |
Not an example: writing off bad debt |
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The former CEO, now a convicted fraudster, who said that he began to feel that his worth as a person was tied up in the performance of his stock was |
Barry Minkow |
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The following statements are true: |
1) larceny is stealing cash after it has been booked 4) skimming is stealing cash before it is booked 5) eighty percent of all misappropriations are cash |
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Ghost employees are discovered by: |
Looking for employees with the same address; looking for employees with the same bank account for direct deposit; looking for employees with no withholding for insurance or taxes |
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There were several points made in the story, "Hey the Rats are Stealing my Cheese!" They are: |
Fraud prevention and security must evolve with the threat; Certified Fraud Examiners specialize in fraud prevention and examination; management expects return on its investment in security and fraud prevention |
Not a theme: security and fraud are pretty much the same thing |
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Regarding bribery, kickbacks and rigging x b the following are true: |
A bribe is usually a one-time payment to an inside person for influencing a decision; a kickback usually signals a continuing relationship between the inside person and the payer; in bid rigging the inside person usually gets a percentage of the profit on a continuing basis. |
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In the case of Frank Gruttadauria, the rogue employee working at Leham Brothers who created bogus customer account statements, Lehman Brothers settled the case after the prosecution threatened to use the theory of: |
willful blindness |
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