Policies and Procedures to Prevent Fraud and Embezzlement: Guidance, Internal Controls, and Investigation

Acknowledgments.

Preface.

Disclaimer.

About the Companion Website.

Section 1 Embezzlement: Who Does It and When.

The Perpetrators: Who They Are, Why They Do It, and How They Are Caught.

The Embezzler’s “Window of Opportunity”.

Section 2 Statement of Auditing Standard No. 99 “Consideration of Fraud in a Financial Statement Audit”.

Statement of Auditing Standard No. 99 “Consideration of Fraud in a Financial Statement Audit”.

Section 3 Essential Internal Control and Administrative Procedures to Avoid Embezzlement.

The Background Check.

Conditions of Employment Agreement.

Conflicts of Interest.

Nepotism.

Whistleblowers.

Noncompete Agreements.

Confidentiality of Information.

Bonding Issues.

Signers on Bank Accounts.

Two-Signature Checks.

Lockbox.

Positive Pay.

Deposit Security and Restrictive Endorsements.

Check Stock.

Cash Transactions.

Cash Register Issues.

Insurance Committees.

Computer File Backups.

Check and Wire Transfer Signatures.

Inventory Issues.

Company Credit Cards.

Lines of Credit.

Bad Debt Policy.

Internal Audits.

Stop Payment Orders.

Voiding Checks.

Numbered Check Request Forms.

Expense Accounts.

CPA Management Letters.

Random Disbursement Checks.

CHECK 21.

Section 4 Clever Examples of Embezzlement.

Payroll Tax Deposits.

Check Switching.

Ghosts on the Payroll and Ghost Vendors.

The Danger of Acronyms.

Bank Account Reconciliations.

Wire Transfers.

Postage Issues.

Kiting.

Manual Checks (Handwritten and Typed).

Auditing Receipts.

Section 5 Steps to Take If You Have Been Victimized by Fraud.

Documenting a Fraud Action Plan.

Fraud Examinations and Assembling the Fraud Team.

The Basics of Forensic Accounting.

Section 6 Identity Theft.

Identity Theft Issues.

Section 7 Internal Control Analysis, Documentation, and Recommendations for Improvement.

CPA Financial Statements, Management Letters, and Consulting Agreements.

Fraud Glossary.

Index.