Fraud Triangle Case Summary
“Analysis Effectivity of Fraud Triangle to detect and predict of fraudulent financial statement”
Chapter 1
Introduction
1.1 Background
Financial statement as the information of company condition should be reflect the about its real condition. As auditor has an important role to detect fraud and give reasonable assurance that financial statement free from material statement.
As write on above, financial statement should reflect the real condition of the entity. In nowadays, there’s a lot of accounting scandal included top management and auditor.
From the research which is done by ACFE (Association of Certified Fraud Examiner) on more than 100 countries, in 2014 there are three occupational fraud, asset misappropriate is by far the most common
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(2004) develop fraud prediction models using financial ratios; however, their models suffer from high misclassification rates. Skousen and Wright (2008) use logistic regression to predict fraud roughly 69 percent of the time. Fraud triangle component can’t be research directly, so there are some additional test to determine whether the significant proxy variables could actually be used in the prediction of financial statement fraud (skousen, 2009). Based on skousen’s study (2009) examining the effectiveness of the fraud risk factor framework adopted in SAS No. 99 in detection of financial statement …show more content…
Does Pressure proxies can be used to detect and predict fraudulent financial statement ?
2. Does Opportunity proxies can be used to detect and predict fraudulent financial statement ?
3. Does Rationalization proxies can be used to detect and predict fraudulent financial statement ?
1.3 Purpose and benefit of reasearch
The purpose of this research is to obtain empirical evidence which is the fraud triangle can be used on detection and prediction fraudulent financial statement.
The benefit from this study are to give an information to company management about the factors which is causing fraudulent financial statement to prevent financial statement from material mistatement and to give an understanding of about fraudulent financial statement and how to detect it with proxy from fraud
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Guy Ross Health Care Fraud Case
216 Words | 1 PagesPage 1 of 2 Caterra Bruno05/17/2018HS115A medical assistant was sentenced today to 36 months in prison for his role in a conspiracy to defraud the Medicare program, the Departments of Justice and Health and Human Services announced. Guy Ross was also sentenced by U.S. District Judge Denise Page Hood in the Eastern District of Michigan to three years of supervised release following his prison term and was ordered to pay $472,623 in restitution. Ross, 51, pleaded guilty in July 2010 to one count of conspiracy to commit health care fraud. According to court documents, Ross received kickbacks from the owners and/or operators of two Detroit-area home health agencies, Patient Choice Home Healthcare Inc. and All American Home Care Inc., in exchange
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301 Words | 2 PagesMedicare fraud is a very common occurrence in the United States. However, there are whistleblowers who are working hard to stop Medicare fraud. The vast majority of people who report Medicare fraud are healthcare professionals. This includes people such as ambulance drivers, physicians, nursing home workers, hospice workers and nurses. There have been some changes recently to the United States whistleblower laws.
Income Smoothing Case Study
1491 Words | 6 PagesThe fraud triangle is made up by three distinguished elements. These elements in the fraud triangle consist of pressure, opportunity, and rationalization. The overall representation of the fraud triangle can be seen as the specific model to spot any type of high-risk unethical and fraudulent performances being conducted by a company, in this case Cendant Corporation. Cedant Corporations actions can be analyzed by the fraud triangle by the way that their senior management/top management decisions fell into the three categories of pressure, rationalization, and opportunity. Cendant Corporation had the pressure to comply with their shareholders and to maintain a stable financial status to prove that they were a profitable organization with a bright company image.
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390 Words | 2 PagesIt was weird listening to an irrational and unreasonable story being told in rational and logical manor. The way Barry Keenan spoke about the kidnapping, it felt he was making a business plan rather than planning a kidnapping. Even though his mind was altered due to alcohol and painkillers, Keenan was very methodical in his planning. He even calculated and exact amount that was need and when Sinatra offered more, Keenan tried to talk him down to the preplanned amount. The reasoning for this being that he wanted to pay it back.
Describe The Rationalizations Used By Mr Pavlo
425 Words | 2 PagesHe also rationalized his fraudulent activities by hiding the customer’s late payment in order to be benefitted himself, but said that he was helping people more than he was helping himself. 2. Given that Mr. Pavlo’s fraud was restricted to an accounts receivable embezzlement scheme, what symptoms might auditors observe?
White Collar Crime Essay
830 Words | 4 PagesSo do investment advisers who improperly use client funds they have been entrusted to protect. Embezzlement is one of the rarest forms of white-collar crime, accounting for just 6.5 arrests per 100,000 people (Bureau of Justice
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860 Words | 4 PagesProfessional scepticism is an important part of auditing as it necessitates the auditor exercising their qualified judgement in dealing with occurrences and circumstances of a countless number. (Auditing and Assurance Standard Board, 2012). Since the global financial crisis, there has been increasing importance placed on applying professional scepticism and many auditors have been criticised for not using scepticism in their valuation and assessments of factors like going concern issues, fair value judgements and related party transactions. (Association of Chartered Certified Accountants, 2015). Additionally, the importance of professional scepticism is essential in reducing the number errors found in financial statements.
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Ethical Issues In Waste Management
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1656 Words | 7 PagesThe paper will calculate the financial ratios of company that will be interpreted with the implications of ratios. Moreover, the paper will describe the indicators of fraudulent reporting. Discussion Purpose of Income Statement It is also called profit and loss statement or income or expense statement. The main purpose of income statement is to indicate managers and investors whether the organisation was cost-effective
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