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DWalker: Posted on Tuesday, May 01, 2012 6:16 PM
Forensic Accounting Specialists is very excited to have ourselves included in the Worcester Business Journal's 2012 Business Profiles edition. This can be viewed via the following link.
If you have questions regarding the firm's areas of practice please call 978-821-3469 |
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D. Walker C.F.E.: Posted on Tuesday, March 06, 2012 1:09 PM
The basic payables function requires the collection of
documentation to properly authorize a cash disbursement. This is a fundamental business
operation.
Evaluating/Mitigating
Risk in Fraudulent Cash Disbursements requires looking at the Inputs into the
payables system to evaluate the existence (or the risk for) the presentation of
false statements as the legitimate basis for cash payments (Outputs):
The Basic Payables Process (Fraudulent Disbursement)
To accomplish this kind of evaluation a company needs to
address the following:
1) Current
Internal Controls a. Purchasing
authorization levels and assignments b. Disbursement
authorization levels and assignments c. Segregation
of duties (not limited to the following) i. Payroll ii. Bank
Account Reconciliation iii. Purchase
Processing and Authorization (Controls)
iv. Payment
Processing and Authorization (Controls)
v. Receiving/Inventory
2) Distribution
Record a. Application of Benford’s
Law b. Vendor
validation/approval due diligence c. Patterns
(Duplication) Analysis d. Detailed
Evaluation of Supporting Documentation (dependent on findings)
Forensic Accounting Specialists recommends an annual
evaluation of the above outline to mitigate the probability of on-going
payables fraud, and to minimize loss attributable to such fraud actions, when identified.
Please call 978-821-3469 to schedule an
initial free consult about your testing operation’s payables function. |
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DWalker: Posted on Thursday, January 26, 2012 11:41 AM
Different Fraud Schemes impact the basic Financial Statements is a variety of ways. The following examples provide very simple logic flows of three types of fraudulent behaviors 1) Billing or Payables Schemes, 2) Premature or Fictitious Revenue Recognition, 3) Skimming Schemes. The general themes of the analysis necessary to identify the "Red Flags" associated with thee schemes are cited. (Note: Impact on Statement of Cash Flows has been ignored here for simplicity within diagrams)
Please contact Forensic Accounting Specialists (978-821-3469), or via www.forensicaccountingspecialists.com) to discuss how we apply the financial analytics to identify this type of behavior and mitigate the potential losses these schemes represent.
1) Billing/Payables Loss via Shell Company
2) Violation of Revenue Recognition Rules
3) Skimming of Sales |
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