Fraud and Internal Control
Internal control plays an important role in the prevention and detection of fraud. Under the Sarbanes-Oxley Act, companies are required to perform a fraud risk assessment and assess related controls. This typically involves identifying scenarios in which theft or loss could occur and determining if existing control procedures effectively manage the risk to an acceptable level. The risk that senior management might override important financial controls to manipulate financial reporting is also a key area of focus in fraud risk assessment.
The AICPA, IIA, and ACFE also sponsored a guide published during 2008 that includes a framework for helping organizations manage their fraud risk.
Read more about this topic: Internal Control
Famous quotes containing the words fraud, internal and/or control:
“The disfranchisement of a single legal elector by fraud or intimidation is a crime too grave to be regarded lightly.”
—Benjamin Harrison (1833–1901)
“Even if fathers are more benignly helpful, and even if they spend time with us teaching us what they know, rarely do they tell us what they feel. They stand apart emotionally: strong perhaps, maybe caring in a nonverbal, implicit way; but their internal world remains mysterious, unseen, “What are they really like?” we ask ourselves. “What do they feel about us, about the world, about themselves?””
—Augustus Y. Napier (20th century)
““Have we any control over being born?,” my friend asked in despair. “No, the job is done for us while we’re sleeping, so to speak, and when we wake up everything is all set. We merely appear, like an ornate celebrity wheeled out in a wheelchair.” “I don’t remember,” my friend claimed. “No need to,” I said: “what need have us free-loaders for any special alertness? We’re done for.””
—Marvin Cohen, U.S. author and humorist. The Self-Devoted Friend, New Directions (1967)