A Guide to Forensic Accounting Investigation (eBook)

Thomas W. Golden, CPA, CFE (Chicago, IL). Partner, PricewaterhouseCooper LLP specializes in providing consulting and expert witness testimony in both civil and criminal matters with special expertise in forensic accounting, fraud investigation, and financial statement accounting. He is a former Chairman of the Board of Regents for the Association of Certified Fraud Examiners and the current President of the Better Government Association, a citizen watchdog group in Chicago, IL. Mr. Golden is an adjunct professor at DePaul University. Steven L. Skalak, CPA, (Chicago, IL) is the National Practice Leader for PwC Investigations & Forensic Services of PricewaterhouseCoopers LLP. He has participated in a variety of corporate investigations relating to allegations that the Securities and Exchange Acts were violated, and of accounting or auditing improprieties. Steve has represented Audit Committees, Directors, Officers, Auditors, and Companies in class action litigation with shareholders and SEC investigations. Mona M. Clayton, CPA, CFE, (Chicago, IL) Partner for Pwc specializes in international fraud investigations with particular emphasis in Latin America where she has conducted investigations. She has designed investigative practice aids providing for consistent methodologies to be incorporated across common scheme investigations. Ms Clayton is an adjunct professor at DePaul University.

Preface xxi

Acknowledgments xxiii

CHAPTER 1 Fraud: An Introduction 1

CHAPTER 2 Psychology of the Fraudster 25

CHAPTER 3 The Roles of the Auditor and the Forensic Accounting Investigator 37

CHAPTER 4 Auditor Responsibilities and the Law 63

CHAPTER 5 When and Why to Call in Forensic Accounting Investigators 79

CHAPTER 6 Internal Audit: The Second Line of Defense 95

CHAPTER 7 Teaming with Forensic Accounting Investigators 115

CHAPTER 8 Anonymous Communications 133

CHAPTER 9 Personal Privacy and Public Disclosure 151

CHAPTER 10 Building a Case: Gathering and Documenting Evidence 175

CHAPTER 11 Independence, Objectivity, Skepticism 191

CHAPTER 12 Potential Missteps: Considerations When Fraud Is Suspected 213

CHAPTER 13 Potential Red Flags and Fraud Detection Techniques 231

CHAPTER 14 Investigative Techniques 271

CHAPTER 15 Corporate Intelligence 293

CHAPTER 16 The Art of the Interview 317

CHAPTER 17 Data Mining 333

CHAPTER 18 Report of Investigation 363

CHAPTER 19 Supporting a Criminal Prosecution 389

CHAPTER 20 Working with Attorneys 399

CHAPTER 21 Financial Reporting Fraud and the Capital Markets 417

CHAPTER 22 Financial Statement Fraud: Revenue and Receivables 433

CHAPTER 23 Financial Statement Fraud: Other Schemes and Misappropriations 467

CHAPTER 24 Ponzi Schemes 495

CHAPTER 25 Money Laundering 511

CHAPTER 26 Foreign Corrupt Practices Act 527

CHAPTER 27 Construction Projects 547

CHAPTER 28 Contract Compliance 571

CHAPTER 29 Other Dimensions of Forensic Accounting 585

CHAPTER 30 Corporate Remediation 593

Index 611