Internal Controls

Fraud Triagle The most important element of the subterfuge triplicity is opportunity. For an employee to commit caper, the workplace environment must provide opportunities that an employee visual modality exploit. Opportunities occur when the workplace lacks sufficient controls to deter and detect actor. For example, paltry monitoring of employee actions digest create opportunities for theft and can aid employees because they believe they will not be caught A mo 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 component that contributes to fraud is rationalization. In order to justify their fraud, employees rationalize their corrupt actions. For example, employees sometimes justify fraud because they believe they ar underpaid spy the employ er is making lots of money. These employees feel justified in take 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 divergence the Sarbanes-Oxley Act of 2002 (SOX).

infra SOX, all publicly traded U.S. corporations atomic summate 18 required to maintain an qualified system of natural control. Corporate executives and boards of directors must ensure that these controls are reliable and effective. In addition, independent outside auditors must show to the adequacy of the sexual contro! l system. Companies that fail to comply are subject to fines, and company officers can be imprisoned. SOX also created the humans Company report Oversight Board (PCAOB) to establish auditing standards and foil auditor activity. interior 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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