Inventory, Expense and Payroll Fraud

Overview

Inventory is a wonderful place to both hide fraud and commit fraud.  The reasons that inventory is subject to so much fraud is the it is often very large, spread out over a large area, and many people have access to it.  When there are little or no internal controls related to inventory control, you are begging employees to steal it.  No with so many ways to dispose of stolen inventory via the internet, i.e., EBAY, inventory fraud is much more appealing to a lot of individuals.

The more common ways to commit expense fraud and how to cover it up will also be discussed.  Travel and entertainment are some of the favorite areas of committing expense fraud.  In addition, payroll fraud will be discussed.  Although there are many ways to commit payroll fraud, it is very easy to prevent.

This presentation is designed to familiarize the participants with the many ways to commit inventory, expense and payroll fraud, how to detect it, and more importantly, how to prevent it.

Prerequisites

None

Objectives

• Identify the areas of opportunity to commit inventory, expense and payroll fraud
• Analyze the opportunities to commit inventory, expense and payroll fraud
• Develop audit procedures to detect inventory, expense and payroll fraud
• Implement internal controls in these areas

Highlights

• Methods of committing inventory, expense and payroll fraud
• What to look for when observing inventory
• Detection of inventory fraud
• How to recognize fictitious expenses
• How to recognize altered expenses
• Indicators of fake documentation
• The three main reason we ask for documentation
• Detection and prevention of ghost employees