BackgroundPertemuan I

Matakuliah : F0184/Audit atas KecuranganTahun : 2007

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• Mahasiswa diharapkan mampu mendefinisikan fraud

• Mahasiswa akan mampu mengindentifikasi fraud berdasarkan kriterianya

Learning Outcomes

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• Fraud Definition• Fraud Theory / Principles of Fraud

– Opportunity– Pressure– Rationalizm

• Fraud Component

Outline Materi

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Definition

• Wide terminology of fraud is intentional deception

• Business or commercial fraud is criminal deception intended to benefit the deceiver financially

• Law terminology: Fraud embraces all the multifarious means which human ingenuity can devise, which are resorted to by one individual, to get an advantage over another by false representations

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Terminology

• Fraud

• Theft

• Embezzlement

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Fraud Component

• Misrepresentation• Time Frame is in the past or present• Material Fact• Make-knowingly or recklessly• There’s a victim• There’s a lost• Illegal Act

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Corporate Fraud Corporate fraud globally could be fall into two

main category:

• Fraud that are intended to benefit the organizational entity

• Fraud that are intended to harm the entity

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Fraud ClassificationFraud classification can be seen by :• The Actor

• The Victim

• Legal Act

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Fraud Classification by Act

• Financial Statement Fraud

• Asset Missapropriation

• Corruption

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Fraud factor or variables• Personal variables

– Aptitude or abilities– Attitudes or preferences– Personal needs or wants– Values or beliefs

• External variables– Degree of competition– General economic condition– Societal values

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Fraud factor or variables (con’t)• Organizational variables

– Nature or scope of the job– Tools or training provided– Reward or recognition system– Quality of management and supervision– Clarity of role responsibilities– Clarity of job-related goals– Interpersonal trust– Motivational and ethical climate

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Organization Criteria Fraud in organization usually occur in

organization that have:

No Controls No trust No ethical standards No profits No future

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Fraud Audit Vs Financial Audit

• Financial Audit

• Forensic Accounting

• Fraud Audit

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Transaction Vs Statement Fraud

Transaction fraud usually are intended to facilitate the theft or conversion of organizational assets to one’s personal use

Statement fraud usually involve the intentional misstatement of certain financial values to enhance the appearance of profitability and deceive shareholders or creditors

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