Testing for Occupational Fraud: How to Conduct Forensic Audits, Exams, and Evals - OAF301

Description

In this three-day seminar, attendees will learn how to integrate fraud detection into an audit program and identify key red flags of fraud scenarios. We will focus on preparing fraud risk assessments for core business systems and building fraud audit procedures. We will cover the methodologies used by fraud auditors and focus on the red flags that signal the need for an investigation. You will learn how to implement and develop audit procedures that will increase the likelihood of discovering fraud, including fraud data mining. Throughout this seminar, case studies and class exercises will further illustrate how to integrate fraud detection into your audit program and reinforce proper fraud detection methodologies. At the conclusion of the seminar, attendees will be able to prepare a fraud risk assessment and integrate fraud audit procedures into their audit programs.

What you will learn

Objectives

Understanding Fraud:

• what constitutes fraud
• understanding how fraud is concealed
• using the inherent fraud scheme approach
• how to describe a fraud scenario in your work papers
• using the fraud scenario matrix

Business Process Fraud Risk Assessment:

• what is the fraud risk universe
• fraud risk assessment approaches
• how to scope fraud into the audit program
• overview the fraud risk audit standards

Preparing the Fraud Risk Assessment:

• what are the required elements of a fraud risk assessment
• preparing the fraud assumption memo
• identifying all the fraud scenarios
• how to assess fraud likelihood and exposure analysis
• how to score residual fraud risk
• linking the internal controls to the fraud risks
• linking the audit program to the risk assessment

Integrating Fraud into the Audit Program:

• comparison of the three fraud testing approaches
• documenting the red flags into your work papers
• test and evaluate the design of anti-fraud controls
• building fraud audit procedures
• how to conduct the fraud audit
• responding to whistleblower allegations

Data Mining for Fraud Scenarios:

• developing a fraud data mining plan
• six strategies to fraud data mining
• integrating data mining into your sampling approach
• how to build a data mining procedure

Fraud Testing for Disbursement Scenarios:

• how to locate shell companies
• testing approaches for false entity schemes
• uncovering the pass thru vendor scheme
• understanding vendor overbilling scenarios
• disguise personal expenditures scenario

Fraud Testing for Procurement Scenarios:

• where and how influence occurs in procurement fraud
• testing for corruption and bribery scenarios
• testing for conflict of interests
• vendor bid rigging schemes

Fraud Testing for Payroll Scenarios:

• ghost employee scenarios
• false adjustments scenarios
• overtime fraud
• fraud in the payroll office
• characteristics of fraudulent departments and employees

Locating Fraud in Travel Expenses:

• understanding the reasons for travel fraud
• how travel fraud is concealment
• comprehensive list of travel fraud scenarios
• travel fraud audit procedures

Fraud Testing in Contracts:

• understanding the contract audit process
• corruption in the contract function
• building arguments to support your position
• how vendors over bill contracts
• progress payment fraud scenarios
• non-conforming material scenarios
• defective pricing scenarios
• cost mischarging scenarios
• audit implications of the false claims act

Fraud Testing in Sales and Cash Receipts:

• skimming scenarios
• theft of product for resale scenarios
• theft of cash receipts scenarios
• lapping and embezzling in accounts receivable
• customer fraud scenarios
• understand concealment of schemes
• identify specific audit areas and procedures

Equipment and Asset Fraud:

• theft of assets
• misuse of assets
• assets acquired for non-business purpose scheme
• excessive expenditures scheme and how it works
• understand how fraud occurs at asset purchase and asset retirement

Money Laundering:

• definition and understanding of implications
• stages of money laundering process
• identify steps to be taken against money laundering
• define suspicious activity in regards to money laundering

Fraud Controls in Core Business Systems:

• understand fraud control concepts
• organization risk appetite
• sophistication of concealment related to controls
• gate keeper unique opportunity
• control inhibitors

Case Studies and Exercises