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All Business
Training: A powerful way to prevent fraud
Preventing
fraud is a big responsibility for all levels of financial
management--manager, controller, and CFO. Since managers are responsible for
preventing and detecting fraud, they must constantly ask themselves, "What
more can we do?"
Most fraud is discovered through
internal controls, auditors, and employees who notice suspicious activities.
Therefore, you may want to consider training fiscal employees and managers
to detect fraud. (Read
more...)
CPAs need to dedicate time to fraud education
CPAs
have always played a central role in fraud prevention, detection and
deterrence. From helping small businesses find holes in internal controls to
providing reasonable assurance that no material fraud exists in a financial
statement, the CPA is frequently the first line of defense in combating
fraud.
Still, says Barry Melancon, AICPA president
and CEO, many CPAs are unaware of how prevalent fraud is, especially among
small businesses, and of the tricks that many fraudsters play. "CPAs need to
understand the intricacies of fraud," Melancon said, "because the entire
nature of fraud is stealth and deception."
For this reason, Melancon in a September 2002 speech called upon CPAs that
audit or work for publicly traded companies to devote at least 10
percent of their CPE to the study of fraud. That dedication plays an
important part in rebuilding the public trust in the accounting profession
and rebuilding investor faith in financial reporting, two goals of the
AICPA's multi-faceted Antifraud and Corporate Responsibility Program. (Read
more...)
Ferreting out fraud: the Dow Chemical Company's success story
You've seen the three-paragraph blurb in the back pages of your newspaper:
Executive Prosecuted for Defrauding Company. While most employees are
honest, fraud remains a fact of doing business that not only impacts the
bottom line but, if left unchecked, can damage employee morale. The question
for The Dow Chemical Company is: How does a global corporation serving
customers in 170 countries confront this sensitive problem consistently and
cost effectively? Quite well, actually. For every $1 we spend on
investigating fraud, we recover nearly $4, which is very high by industry
standards. And with more than 50,000 employees, Dow's loss per employee is
far below the industry average of $9 per employee per day. (Read
more...)
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