ch 9 notes - PRINCIPLES OF FRAUD EXAMINATION Lecture...

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PRINCIPLES OF FRAUD EXAMINATION Lecture Outline Chapter 9 – Non-Cash Assets I. Non-Cash Misappropriation schemes – are occupational frauds in which employees misuse or steal inventory, supplies, equipment and other non-cash company assets. A. Misuse of non-cash assets – unauthorized use of a company asset 1. Non-cash assets that are typically misused include: a. company vehicles b. company supplies c. computers d. other office equipment 2. The costs of inventory misuse – difficult to quantify a. loss of productivity b. additional employee wages (for more hires) c. lost business (from competition of employee) d. additional wear and tear on equipment e. possible non-return (theft) of asset A. Unconcealed larceny schemes – occur when an employee takes property from the company premises without attempting to conceal it in the books and records 1. Misappropriation of assets in front of coworkers a. coworkers do not suspect fraud b. coworkers are aware of the fraudulent activity but ignore the illegal conduct because of: i. sense of loyalty to their friends ii. "management vs. labor" mentality iii. intimidation iv. poor channels of communication v. collusion vi. lack of proper whistleblowing procedures 2.
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This note was uploaded on 04/01/2012 for the course AC 562 AC 562 taught by Professor Online during the Spring '11 term at Keller Graduate School of Management.

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ch 9 notes - PRINCIPLES OF FRAUD EXAMINATION Lecture...

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