1. Fraud Examination, 3E Chapter 14: Fraud Against Organizations COPYRIGHT © 2009 South-Western, a part of Cengage Learning

2. Learning Objectives Understand the extent to which employees and others commit occupational fraud. Describe the nature and various types of asset misappropriations. Discuss the nature and various types of corruption. 2

3. Occupational Fraud 3 Corruption Fraudulent Financial Statements Asset Misappropriation

4. Asset Misappropriations Definition Any scheme that involves the theft or misuse of an organization’s assets. 4

5. Asset Misappropriations Opportunities to steal assets: 1.Steal receipts of cash and other assets that come into an organization. 2.Steal cash, inventory, and other assets that are on hand. 3.Commit disbursement fraud by having the organization pay for something it shouldn’t or pay too much for something. 5

6. Asset Misappropriations Types of Asset Misappropriations 6

7. Asset Misappropriations Well’s Division of Asset Misappropriations 7

8. Corruption Definition Any scheme in which a person uses his or her influence in a business transaction to obtain an unauthorized benefit contrary to that person’s duty to his or her employer. 8

9. Corruption Types of Corruption Schemes 9

10. Fraudulent Statements Definition Fabrication of an organization’s financial statements to make the company appear more or less profitable. 10