Specifically, the following critical elements must be addressed:
I. Introduction: What company is the subject of the case? Describe the type of fraud that occurred.
II. Analysis of Fraud Scheme Type
A. Explain the process behind how frauds of this type are carried out. Provide a specific example illustrating fraud of this type.
B. In this type of fraud scheme, how and where do internal controls break down? Provide examples of specific internal controls needed to reduce this type of fraud.
C. What are the risk factors when assessing this type of fraud? Consider classifying the risk factors using the theoretical model such as the Fraud Triangle.
D. How can analytical procedures and other detection methods be applied to assess the risk of this type of fraud? Provide specific examples of the analytical procedures and what they indicate.
E. Discuss the professional responsibilities of auditors in detecting fraud. What sort of impact can an audit have on an organization?
F. What evidence is needed to prove the fraud? Why? To guide your review of evidence, please review the article The Basics of Evidence for Fraud and Corruption Investigators.