Understanding Fraud

Auditors are responsible for identifying potential fraud risks and, where possible, detecting fraud.

Types of Fraud

• Misappropriation of Assets: Theft of cash or property.
• Financial Statement Fraud: Manipulating numbers to mislead.

Auditor’s Role

Auditors:

• Assess fraud risk during planning
• Test controls and look for red flags
• Report suspicious activities appropriately

Prevention is Key

Strong internal controls and a culture of honesty help deter fraud.