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Accounting Procedures Essay

810 words - 3 pages

With the large scandals involving misrepresentations of financial records recently, such as Enron, there is a need for investigations beyond the accounting auditor capabilities. A look at the different qualifications of a forensic accountant or more specifically a fraud auditor will show that this position would fill those needs. This paper will look at what a fraud auditor does and how it is different than what a regular auditor does. It will also look at some of the qualifications needed to become a fraud auditor.Many would think an auditor and a fraud auditor were basically the same thing. A look at what each position does will show they are not. An auditor of financial record is looking to see if the company's financial records they are auditing have been prepared according to GAAP (general accepted accounting practices). While do so an auditor is not very likely to uncover fraud. A fraud auditor's, on the other hand, main purpose is to look for signs of fraudulent activities. Usually a fraud auditor is asked to perform an audit after there has been some suspicious activities uncovered where as an audit might be done because of certain questionable activities it is usually done on a periodic basis regardless of any circumstances. What is a fraud auditor looking for exactly?The fraud auditor is looking for the unusual as opposed to the usual. The cash accounts are an area which fraud is usually found. When employees are involved in fraud a fraud auditor can sometimes tell which employees are involves. The following types of accounts are typical fraud targets:- Payable, payroll, benefits, and expense accounts- these are typical targets of lower-level employees- Profits, deferred expenses, salaries, revenue, inventory - these are in the typical targets of higher-level employees ( Fraud auditing and Forensic Accounting)When a fraud auditor is doing the investigation it involves more than just looking at the financial record. They must look at the people or employees involved. A fraud auditor interviews employees looking for thing beyond the finances of the company. When conducting the interview they are looking for employees living above their means or if they may have a gambling problem or drug addiction. They are looking for people with opportunity and motive. If they see something along those lines they might conduct an audit of those individuals' personal financial records. Besides interviews they look at a company's internal controls, and how they might contribute to any...

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