Forensic accounting pdf download

Chapter four presents the requires the presentation of general characteristics stylized facts on the study subjects and the general issues found from the study that may not be specific to any hypothesis. It describes the environment of the study including some demographic characteristics specific to the study subjects this chapter also mention some limitations face during this entire period.

Meanwhile chapter five talks of conclusions and recommendations that are findings in brief sentences in line with the result presented in chapter 4. However, the word forensic means "suitable for use in the court of law". Forensic accountants always have to give their expert evidence at any eventual financial fraud or related cases trial.

This crimes may involves credit card frauds, corporate fraud, mortgage fraud, security , medical fraud insurance fraud, market manipulation, tax invasions, money laundering, counterfeiting both money and goods forgery and many others.

These crimes may also include; armed robbery, burglary. It is carried out by individuals, corporations or by organized group of persons.

Victims here may includes; government, the general public, companies and many more. A Detective A detective is simply defined as an expert that is capable of detecting wrong doing but gathering information openly or undercover. It seeks to point out the concepts and theories that support the variables in this study with an ultimate goal of identifying the gaps and showing how this work shall attempt to fill them. Therefore, the literature review has been approached according to the aforementioned subtopics and details materials which will be discussed below.

Conceptual literature 2. The Concept of Forensic Accounting Hopwood, Leiner, and Young define forensic accounting as the application of investigative and analytical skills for the purpose of resolving financial issues in a manner that meets standards required by courts of law.

According to Curtis , forensic accountants are essential to the legal system, providing expert services such as fake invoicing valuations, suspicious bankruptcy valuations, and analysis of financial documents in fraud schemes.

Crumbley defined forensic science as the application of laws of nature to the laws of man. He described forensic scientists as examiners and interpreters of evidence and facts in legal cases that also offers expert opinions regarding their findings in court of law. Dhar and Sarkar define forensic accounting as the application of accounting concepts and techniques to legal problems.

It demands reporting, where accountability of the fraud is established and the report is considered as evidence in the court of law or in administrative proceedings. Forensic accounting is a discipline that has its own models and methodologies of investigative procedures that search for assurance, attestation and advisory perspective to produce legal evidence.

Onodi, Okafor and Onyali are of the opinion that forensic investigative skills are required to uncover and establish the occurrence of financial crimes due to the incidence of fraud and misappropriation of funds in recent time that is posing a threat to traditional auditing as a branch of accounting profession.

According to Prof. Richard Mayungbe , refers to the ideas of George A. Forensic accounting is rapidly growing in today's accounting and it involves the detection and prevention of financial and white-collar fraud.

The combination of accounting, auditing, and investigative skills combined to give birth to the specialty called Forensic Accounting, which main area of concern is to detect or prevent economic and financial crimes. Accounting is a system of summarizing and recording business and financial transactions which analyzes, verify, and record the results. Thus, forensic accounting aims at using accounting report in a form suitable for legal purposes as cited in Durvesh S.

Naik, No one description suffices. Williams incorporates corruptions, bribes cronyism, nepotism, political donation, kickbacks, artificial pricing and frauds of all kinds to his description of financial crimes. Nwaze defined fraud as a predetermined as well as planned tricky process or device usually undertaken by a person or group of persons with the sole aim of cheating another person or organisation to gain ill-gotten advantage which would not have accrued in the absence of such deceptive procedure.

Karwai is of the view that financial fraud in organizations vary widely in nature, character and method of operation in general. It was noted by Nwaze that fraud is perpetrated in many forms and usually has insiders staff and outsiders conniving together to successfully implement the act. Fraud may be classified into two broad ways: nature of fraudsters and method employed in carrying out the fraud. On the basis of the nature of the fraudsters, fraud may be categorized into three groups, namely; internal, external and mixed frauds.

Internal fraud relates to those committed by members of staff and directors of the organizations while external fraud is committed by persons outside the organization and mixed fraud involves outsiders colluding with the staff and directors of the organization.

Although fraud affects the whole world, the magnitude of fraud in Nigeria and the extent to which the economy is affected is a call for alarm Abiola, Financial crimes are crime against property, involving the unlawful conversion of the ownership of property belonging to another to one's own personal use and benefit. Financial crimes may involve additional criminal acts, such as computer crime, elder abuse, burglary, and even violent crime such as armed robbery or murder. Financial crimes may be carried out by individuals, corporations, or by organized crime groups.

Victims may include individuals, corporations, governments, and the economy at large. Fraudsters think seven times a day whereas the average manager or staff of an organization or government thinks rarely or none at all. A cheat feels of a fraudulent scheme or strategy when he wakes in the morning, at mid-day he or she thinks of another plan, at evening he or she thinks and designs yet another approach, at around Just before they goes to sleep he or she feels about another method, at approximately three he wakes up and thinks about two strategies and prays for their success and at dawn, he or she feels about the final approach for that day just before breakfast.

During all this time the managers and other staff including the common man are asleep such people cannot match fraudsters or win against them. They often strike many times before any suspicion of fraud arises. At such leaders of organizations must look for proactive systems and policies that will allow for the creativity of staff to grow instead of letting them sleep while the fraudsters are working hard in targeting their organization IICFIP USA, Usually, it is assumed that there are external motivating factors driving people to commit fraud, such as economic situation, socio-political factors, competitive factors, weak internal control mechanism etc.

However, it is crucial to acknowledge the personality traits and internal motivators of those who commit fraud. It is essential to ask whether certain people are more likely to commit fraud than others. According to research conducted to find out whether employees are honest at work or not, forty per cent of the employees said they would not steal, thirty per cent said they might take, and thirty per cent said that they would steal.

Grabosk, Duffield According to Gwynn Nettler, In his Lying, Cheating and Stealing principle he makes the following assessment of cheaters. In the views of Singleton and Singleton, forensic accounting comprehensively entails fraud investigation, prevention of fraud and analyzing antifraud gathering non-financial information.

They, however, contend reference to fraud, fraud investigations are an integral part of forensic accounting. Forensic accounting or financial forensics practice area of accountancy that describes engagements that result from actual or litigation. Forensic accountants are also referred to as auditors or investigative auditors, future trial.

Other terminologies used to describe forensic accounting include; Forensic Investigation according to the English oxford dictionary it is defined as the use of special skills of investigating in carrying out an inquiry which is conducted in such a manner that the outcome will have an application to a court of law. Forensic Audit is an examination of correspondence which is to established criteria in carrying out a manner which is suitable in the courtroom.

An example here would be a forensic audit of sales records in other to determine the amount of quantum rent owing under a lease agreement, which is the subject of litigation. Dhar and Sarkar Internal Audit it is an audit performed by an employee who examines operational evidence to determine whether prescribed operating procedures have been followed.

Dhar and Sarkar External Audit is conducted by external independent qualified professional. Forensic Accountant involved in analyzing and investigating financial evidence developed by electronic applications which assist in the analysis and presentation of economic evidence and thus communicates their results as a report to the competent court for judicial proceedings and also testify as an expert witness and preparing helping evidence to support the trial.

To better understand these services the Forensic Accountant must be familiar with court procedures and concepts. Also, he must be able to identify substance over from when dealing with this issue.

Even though, their actions and ways of perpetrating the crime might vary, it still involves the violation of delegated or implied trust. The cooperative, if clueless, a victim was necessary for the prediction of the fraud committed. This scenario thus identified three principal factors which aid the crime, namely: offense, the offender and society.

The offense is an act by a respected person in high social and economic status that violates rules or otherwise relating to a professional activity. Those who commit such crimes are usually citizens who by their status are above suspicion. They commit criminal acts in connection with business and their professional conduct, are aware of the lawfulness or unlawfulness of their actions.

They therefore use their social position to violate the law. Thus the main goal pursued by fraudsters is the social or financial success, and in trying to achieve the goal, they employ both legal and illegal or unethical means.

Financial crimes are the crime against property, involving the unlawful conversion of the ownership of property belonging to another to one's personal use and benefit. Financial crimes may include fraud which can take the form of cheque fraud, credit card fraud, mortgage fraud, medical fraud, corporate fraud, securities fraud including insider trading , bank fraud, payment point of sale fraud, health care fraud and so on ; theft; scams or confidence tricks; tax evasion; bribery; embezzlement; identity theft; money laundering; and forgery and counterfeiting, including the production of Counterfeit money and consumer goods.

Victims may include individuals, corporations, governments, and the entire economy. Fundamental Concept of Fraud Fraud has become very common in recent times and there's every need for large organizations to hire a professional forensic agent or accountant to help tackle the pressure or present of financial frauds in the company. Occupational fraud is define as a process of one using his position of responsibility in the company as an advantage to satisfy his personal interest thus enriching himself thus abuse the trust put in him and deliberately abuse of power.

Regardless of the nature of the sectors, the various category of financial crime and other forms of occupational fraud taking place for example, swindles and employee trust violations ACFE, ; Duffield and Grabosky, ; Levi, ; Kiragu et al.

According to Manurung and Hadian Fraud can be also consider as wrongful or criminal deception intended to result in financial or personal gain or any act of expression or a calculated attempt to deceive another person for his own advantages. A misrepresentation with reference to some fact materials that is made with knowledge and with reckless disregard of truth and worth the intent to mislead another and which relied on the other being deceive. Fraud is also being defined as a deliberate act made by one entity knowing that such an action can result to unlawful benefits.

Ernst and Young, Fraud is an intentional and deliberate act of an individual among management, employees and even third parties who causes deliberate errors in their financial reporting in other to favor or satisfy their personal desires Adeneji, and Institute of Chartered Accountants of Nigeria ICAN Fraud is also any deliberate misrepresentation, concealing and negligence of truth to manipulating the financial statement at the expenses of the firm.

Educational, forensic accounting programs available While the subject of the forensic investigation is relatively new, interest in the field is already high, and courses such as this continuing education one are available. Colleges and Universities have begun to offer courses in forensic accounting and criminal investigation course in their catalogues.

Other colleges and universities provide even more to the interested individual than a class or two. The University of Alabama at Birmingham has a four course series in the field. Forensic accounting Certificates are awarded by at least six schools, including one in Australia and one in South Africa.

Few Universities have forensic accounting programs; these are Florida Atlantic University and University of Wollongong, in Australia 2. Professional credentials Several accrediting bodies offer certifications in forensic investigation and accounting or related field.

Besides the Cr. FA, the Association offers other certifications dealing with forensics. There are two paths to become a Cr. One Exam If a person holds an accounting-related license or certificate, just one exam must be taken. Also, other certifications may be allowed by the Association. With those requirements met, the applicant then sits for two exams.

The Cr. In those states, an individual must first be a CPA to utilise the designation of Cr. Other elements include having at least five year of accounting experience and 1, hours of relevant forensic accounting experience.

Further, the individual must have completed a minimum of 75 hours of forensic accounting continuing education. A training program leading to the CFFA allows for specialization in one of five areas. Several certifications related to fraud are available. This credential is available through the Association of Certified Fraud Examiners.

Career options in forensic accounting A forensic investigator might find exciting careers in any number of different types of entities.

CPA firms might employ forensic investigators and an accountant. Large law firms may hire these experts. Also, entities that have large internal audit functions might have forensic accountants on staff. Further, some bodies provide domestic audit services to firms that elect to outsource their internal audit; such providers would undoubtedly benefit from having forensic expertise available for its clients.

Finally, other large businesses and consulting firms would do well to have forensic expertise on staff. All these scandals has called for a global concern on fraud, wiping of shareholders hard earn billions of dollars investment and also cause investors and public confidence in the financial market to become a sham.

Fraud prevention is very pertinent as many companies think it should be the main focus as indicated by many research being carried out concerning fraud-related issues. Thus it is said to be more effective and less expensive to prevent fraud than to detect it after it has occurred.

This is because most at times before fraud is being discover the money or funds stolen might not at all or is recover in part or the recovering chances may be very slim. This is therefore to say more focus should be put in fraud prevention because it will reduce monetary losses and easily tracking down of the perpetrators thus saving time and effort to reconstruct fraudulent transaction.

They all agree to the factors that cause fraudsters to perpetuate their fraudulent practices. FTT originated since from Edwin Sutherland works when he addresses the term white-collar crime and his formal student Cressey then focus his own research work on those elements that cause or motivate individuals to commit unethical or fraudulent practices. Dorminey, Fleming, Kranacher, and Riley His theory entails three pertinent elements which is important for fraud to occur; that's Perceived Pressure, Perceived Opportunity and Rationalization.

David T. Wolfe and Dana R. Hermanson in hi9s book also thinks the former FTT which has enhancing to improve both fraud prevention and detection by considering an additional element above the three, mentioned elements of FTT.

They considered four-sided FDT is adding the ability as the fourth factor. Wolfe and Hermanson , p. Hilmar Westholm and Adebisi.

ACFE and Sutherland Abuse of power by the fraud perpetrators includes deliberate mismanagement, and misrepresentation of organizational assets or properties fixed and current assets.

Fraud Triangle Theory In other to analyze the differences and similarities between FTT and FDT, it's essential to commence with Cressey's FTT in his theory stated that there must be a reason behind everything people do and as such he drives his research on what causes people to commit fraud and thus this led him to focus more on what encourage people to violate the trust given to them.

By doing this, he interviews prison criminals in 5 months whose behavior met two criteria such as 1 Initially, people are accepting the responsibilities of confidence in good faith. In which he attributes them as i perceive pressure, ii perceive opportunity iii rationalization. He, therefore, maintains that this factors must be present for an offence of fraud to take place.

They can take to themselves the responsibility as trusted persons and users of entrusting funds or property. Figure 1. The top part of the picture shows or indicate the pressure that people face which causes them to commit fraud while the two others at the bottom perceive opportunity and Rationalization Well, As time passes, fraud proposition has become known as the FTT.

Everyone who commits fraud faces some pressure to commit unethical conduct Abdullahi, Mansor, These pressures can either be financial or non-financial motives or pressures. However, since this pressure to commit fraud may not be real it is essential to use the word perceived as pointed out by Albrecht et al.

If the perpetrators believed that they were pressurized, their belief could lead to fraud. Perceived pressure can exist in various ways, especially in non-sharable financial need. Financial strength is recognized as the most common factor that influences a person or a group of persons to commit this evil act.

Lister states that weight is a significant factor to commit fraud. He determines three types of strength which are personal, employment stress, and palpable tension. Vona in his theory examines the corporate forces which motivates the commitment of fraud. Lister , p. This social or political pressure occurs in most situations when a person believes that he cannot afford to fail because of his ego or reputation or status.

Rae and Subramanian In this same line, Vona et al, believed that personal and corporate forces are the critical reasons for fraud to be committed. The interaction of the factors above forces an individual in committing fraud Rosefield, ; Vona, ; Okezie, , Rasha, Andrew, Chen et al recognized six basic categories for pressure as a transgression of obligations, personal problems, corporate inversion, position achievement and a relationship between employees.

Albrecht et al. Hooper and Pornelli opine that stress can be either a positive or negative force. Perceived Opportunity This is another element which causes fraud to occur. When there's ineffective control or a system which allows an individual to commit organizational fraud to perceive opportunity is lightly to come into play. In accounting, it is term as internal control weaknesses. The perceive chance which suggests that people take advantage of circumstances available to commit fraud.

Nevertheless, this possibility is often in the belief or perception of the fraudster. Rae and Subramanian set an alarm that opportunity refers to the strength and power of employees to realize the weaknesses face in the organizational system and takes advantage of it by making fraud possible.

More so, Srivastava, Mock and Turner argue that, even when the pressure is extreme, financial fraud can't occur unless an opportunity is present. However, there are two aspect to talk of when it comes to opportunity namely: i the inherent susceptibility of the organization to manipulation, and ii the organizational conditions that may warrant a fraud to occur i the inherent susceptibility of the organization to manipulation, and ii the organizational conditions that may warrant a fraud to occur.

For example, if there is a weak job division, ineffective internal control, random audit, and many others, then the conditions will be favorable for the employee to commits fraud. The proxies used including related party transactions, CEO duality and the difference between control and cash flow rights. Albrecht, et al. In a study by Wilks and Zimbelman , the related party transactions were placed the third amongst the most common of opportunity to the fraudster.

Similarly, Ming and Wong also used related party transactions as a proxy to measure the opportunity. Vance state that another proxy for opportunity was ineffective monitoring that was attributed to the weak directorship in the public sector.

He, therefore, suggested that the domination of the CEO can weaken the effectiveness of the organizational board of directors in ensuring accurate control over management activities. Lindquist and Singleton , stated from the Association of Certified Fraud Examiners revealed that irregular job rotation is contributing to the employees and managers exploit organizational failure to commit fraud. Rationalization The rationalization is the third element of the FTT.

This concept indicates that the perpetrator must formulate some morally acceptable idea to him before engaging in unethical behavior. Rationalization refers to the justification and excuses that the immoral conduct different from criminal activity.

If an individual cannot justify evasive actions, it is unlikely that he or she will engage in fraud. The rationalization is most at times difficult to notice, as it is impossible to read the mind of the fraud perpetrator.

Individuals who commit fraud possess a particular mindset that allows them to justify or excuse their fraudulent actions Hooper, Pornelli, The motives or propensity to commit fraud depends on ethical values as well as on their attitudes of individuals Kenyon, Tilton It is viewed as an expanded version of the FTT. Figure 2 shows the diagram for FDT. In this theory, an element named capability has been added to the three initial fraud components of the FTT. Wolfe and Hermanson argued that although perceived pressure might co-exist with an opportunity and a rationalization, it is however unlikely for fraud to take place unless the fourth element which is capability is also present.

In other words, the potential perpetrator or fraudsters must have the skills and ability to commit fraud. The fraud diamond Maintained that opportunity opens the to fraud and incentive i. However, capability enables the person to recognize the open doorway as an opportunity and to take advantage of it by walking through repeatedly.

It is where the fraudster recognised the particular fraud opportunity and ability which will turn into reality. Moreso, coercion,Position, intelligence, ego, stress and deceit, which are supporting factors of capability.

Wolfe and Hermanson , Mackevicius and Giriunas , siad it is not every one who possessed motivation, opportunities, and realization may commit fraud due to the lack of capability to carry it out or to conceal it. Williams, Albrecht, and Wernz opine that this element is of particular importance when it concerns a large-scale or long-term fraud.

Furthermore, Williams et al. Similarly, Wilson discloses that rationalization and capability are all inter-related, and the strength of each element influences the others. Wolfe and Hermanson state that position and role owned by the employee may perfect his way to breach the organisational trust.

They further explain the findings of the analysis of public companies carried out by Beasley CEOs were implicated in over 70 per cent of the public company's accounting frauds. He also reports that many organizations do not implement sufficient checks and balances to mitigate their CEO's capabilities to influence and perpetuate frauds. This knowledge is used to influence the individual's concern for authorising access to systems or assets Wolfe and Hermanson, p.

The more confident the person developed commit fraud the risk of committing fraud will be lower Wolfe and Hermanson, pp In an article titled, "The Human Face of Fraud" they said that one of the common personality types among fraudsters is the ego. The individuals committing fraud must have a healthy ego and high confidence that they will not be detected. Written by a retired IRS agent with more than twenty years of experience, Financial Investigation and Forensic Accounting, Third Edition offers a complete examination of the current methods and legal considerations involved in the detection and prosecution of economic crimes.

Explores a range of crimes Following an overview of the economic cost of crime, the book examines different types of offenses with a financial element, ranging from arson to tax evasion. It explores offshore activities and the means criminals use to hide their ill-gotten gains. The author provides a thorough review of evidentiary rules as well as the protocol involved in search warrants.

He examines the two modalities used to prove financial crime: the Net Worth Method and the Expenditure Theory, and presents an example scenario based on real-life incidents. Organized crime and consumer fraud Additional topics include organized crime and money laundering — with profiles of the most nefarious cartels — consumer and business fraud and the different schemes that befall the unwary, computer crimes, and issues surrounding banking and finance.

The book also presents focused and concrete advice on trial preparation and specific accounting and audit techniques. New chapters in the third edition New material enhances this third edition, including new chapters on investigative interview analysis and document examination, as well as advice for fraud examiners working on private cases, including the preparation of an engagement letter.

For a successful prosecution, it is essential to recognize financial crime at its early stages. This practical text presents the nuts and bolts of fraud examination and forensic accounting, enabling investigators to stay ahead of an area that is increasingly taking on global importance. Providing valuable information to those responsible for dealing with prevention and discovery of financial deception, Fraud Auditing and Forensic Accounting, Fourth Edition helps accountants develop an investigative eye toward both internal and external fraud and provides tips for coping with fraud when it is found to have occurred.

Completely updated and revised, the new edition presents: Brand-new chapters devoted to fraud response as well as to the physiological aspects of the fraudster A closer look at how forensic accountants get their job done More about Computer-Assisted Audit Tools CAATs and digital forensics Technological aspects of fraud auditing and forensic accounting Extended discussion on fraud schemes Case studies demonstrating industry-tested methods for dealing with fraud, all drawn from a wide variety of actual incidents Inside this book, you will find step-by-step keys to fraud investigation and the most current methods for dealing with financial fraud within your organization.

Written by recognized experts in the field of white-collar crime, this Fourth Edition provides you, whether you are a beginning forensic accountant or an experienced investigator, with industry-tested methods for detecting, investigating, and preventing financial schemes.

Forensic Analytics Author : Mark J. This updated second edition shows accountants and auditors how analyzing their corporate or public sector data can highlight transactions, balances, or subsets of transactions or balances in need of attention.

These tests are made up of a set of initial high-level overview tests followed by a series of more focused tests. The tests in the new edition include the newly developed vector variation score that quantifies the change in an array of data from one period to the next.

The goals of the tests are to either produce a small sample of suspicious transactions, a small set of transaction groups, or a risk score related to individual transactions or a group of items. The new edition includes over two hundred figures. Each chapter, where applicable, includes one or more cases showing how the tests under discussion could have detected the fraud or anomalies.

The prospects of the profession, the educational and training requirements are also evaluated. The study also uses a high level forensic tool in a case study into the major Indian Cement companies to detect whether prima facie there has been a likely manipulation of the books of account.

Key-words: Forensic accounting, financial frauds, misrepresentation, miscellaneous fraud Introduction www. Forensic accounting is quite new in India as companies have realized that the service of a forensic accountant is needed as fraud cases have substantially increased in number. Forensic accounting is the application of financial skills and investigative mentality to unsettled issues, conducted within the context of the rules of evidence.

Forensic accounting as a discipline encompasses fraud knowledge, financial expertise, and a sound knowledge and understanding of business reality and the working of the legal system. Forensic accounting may be one of the most effective and efficient way to decrease and check accounting fraud.

A Statutory Auditor under the Indian Companies Act has to perform specific duties and pass his professional opinion on the prepared and certified financial statements. He uses a conventional audit tool that presumes that there are no major compromises in the financial statements. However, the legal position indicts the auditor liable for frauds that have a material significance on the financial statements.

Conventional tools and audit procedures do not permit the Statutory Auditor a reasonable professional satisfaction with the final certified statement as there might have been deliberate concealments or enhancements in the statements. Often such unethical practices are resorted to by the Management and the Auditor would have unwittingly placed confidence in the certifications of the Management. In the past Forensic Accounting was viewed as branch of accounting that was used only if a serious financial crime was committed.

In recent years the science of Forensic Accounting has become pro-active. It seeks to prevent financial crime rather than investigate an already perpetrated crime or fraud. Objectives The study is to understand the analytical tools and techniques deployed by accounting professionals in their area of work.

The main objective of the study is to examine the impact of Financial Analysis and Forensic Accounting averting and preventing the corporate fraud. Hypothesis There are four items considered for hypotheses validation. Literature Review Section 17 of the Indian Contract Act defines fraud as meaning and including any of the following acts committed by a party to a contract, or with his knowledge - The suggestion of an incorrect fact with full belief in its falsehood.

In the United States, State and Federal statutes criminalize fraud, but not all cases are of a criminal nature. Prosecutors have been given the discretion in determining which cases to pursue that implicate fraud. Alleged victims may also seek redress in civil court for damages. The legal requirement of Companies Auditors Report Order Clause xii places the auditor in an arduous situation.

There is a clear and unambiguous requirement for the auditor to state whether any fraud has taken place in the company. This means even a minor fraud irrespective of materiality must be reported. The use of forensic tools will facilitate confidence in audit and financial reporting. Ozkul and Pamukc, , Since the s in some Western countries, particularly in the USA, a new profession in the field of accounting and auditing has emerged.

This profession identifies a field composed of accounting, auditing, and investigative skills. The influence of corporates over legislators or politicians was an important factor to be considered where the law legitimately endorses a social crime. Singleton, T. W and Singleton, A. Fraud Auditing and Forensic Accounting. Singleton and Singleton , said forensic accounting is the comprehensive view of fraud investigation.

It includes preventing frauds and analyzing antifraud control which includes the gathering of nonfinancial information. Forensic accounting has been pivotal in the corporate agenda after the financial reporting problems which took place in some companies around the world. These scandals resulted in the loss of public trust and huge amounts of money.

In order to avoid fraud and theft, and to restore the badly needed public confidence, several companies took the step to improve the infrastructure of their internal control and accounting systems drastically.

Fraud Detection Defining fraud is as difficult as identifying it. No definite and invariable rule can be laid down as a general proposition in defining fraud as it includes surprise, trick, cunning and unfair ways by which another is cheated. According to Ozkul and Pamukc, , the following are the objective of financial statement fraud: Increasing the market value of the business, making financial statements consistent with budgets and obtaining unfair earnings by presenting falsely the value of the business.

The survey method is selected for the purpose of this study in order to collect a sufficient amount of primary data. The use of questionnaires is the most widely used data collection technique in a survey and, in this study.

The data collected are analyzed using Chi-square statistical software and OLS regression analysis these are employed and the results will be used to validate or invalidate the hypothesis. The findings will be discussed and conclusions will be drawn.

Factor Analysis was used for the analysis with the Principal Axis Factoring method for extraction. Rotated values obtained from Factor Analysis were used to interpret the meaning of the factors.

The values are the standardized regression coefficients that are functionally related to a variable and the factor when other factors are held constant. Rotated values greater than 0. Data Analysis The data was consolidated for all five professional groups and also segregated by professional groups.

Professional groups that did not pass the KMO or Bartlett tests were grouped together and considered as a consolidated group.