Last term I took a class that focused on fraudulent financial reporting. This course focused on methods to detect whether the financial statements can be analyzed in ways to determine if fraud is being perpetrated by the company. This would normally involve managers or executives. This term I am in another fraud class, asset misappropriation. This course focuses on ways employees one way or another steal assets from the company. This type of fraud tends to be more common amongst companies but usually results in a smaller amount of loss as compared to fraudulent financial reporting.
In the course we have been learning about different ways employees steal from their company. Usually it involves employees with trusted responsibilities over some type of asset. This can range from an employee taking cash out of the register to more elaborate payroll or billing schemes. While there are way too many different methods for us to cover in 7 weeks, we hit the major and most common approaches used by fraudsters. As part of the class we also talk about how to prevent or detect these frauds. This is clearly a very useful skill to acquire when going into a career as an accountant.
I have really enjoyed this class so far. It is interesting to discuss how creative some of these fraudsters get when perpetrating the crime. Classes involve a mix of discussion about schemes, cases, and videos featuring real world examples. I am looking forward to learn about other kinds of fraud schemes as the course continues.