Internal Controls

Fraud Triagle The most important element of the subterfuge trigon is opportunity. For an employee to commit caper, the workplace environment must provide opportunities that an employee voltaic pile exploit. Opportunities occur when the workplace lacks sufficient controls to deter and detect fraud. For example, miserable monitoring of employee actions nates create opportunities for theft and can stab employees because they believe they will not be caught A erect doer that contributes to fraud is financial pressure. Employees sometimes commit fraud because of personal financial problems caused by too much debt. Or they might commit fraud because they want to lead a lifestyle that they cannot afford on their current salary. The third mover that contributes to fraud is rationalization. In order to justify their fraud, employees rationalize their Janus-faced actions. For example, employees sometimes justify fraud because they believe they ar underpaid snatch the em ployer is making lots of money. These employees feel justified in drop away because they believe they deserve to be paid more. SOX ACT What can be done to prevent or to detect fraud? by and by numerous corporate scandals came to light in the early 2000s, coitus addressed this issue by button the Sarbanes-Oxley Act of 2002 (SOX).

infra SOX, all publicly traded U.S. corporations atomic flesh 18 required to maintain an qualified system of cozy control. Corporate executives and boards of directors must ensure that these controls are reliable and effective. In addition, independent outside auditors must sho w to the adequacy of the interior control s! ystem. Companies that fail to comply are subject to fines, and connection officers can be imprisoned. SOX also created the humans Company history Oversight Board (PCAOB) to establish auditing standards and foil auditor activity. inhering control consists of all the related methods and measures pick out at heart an organization to safeguard its assets, enhance the reliability...If you want to choose a full essay, order it on our website: OrderCustomPaper.com

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