REPORTING Flashcards

1
Q

Each contact an examiner makes during the course of a fraud examination should be recorded on a timely basis in

A

a memorandum of interview

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

You should reconfirm dates and supporting information with the respondent. It is important
to reconfirm the facts ____

A

before the report is written

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Clarity

A

Investigative reports on fraud examinations should convey pertinent information in the clearest possible language. If necessary, quote the respondent directly (provided the quotation does not distort the context). Convey only the facts; do not editorialise or give judgements. Use complex or technical terms in their proper contexts, and, where necessary,
explain their meaning. Do not use jargon since the report might be read by people who are not familiar with esoteric or technical terminology.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Impartiality and Relevance

A

Report all facts without bias. Everything relevant should be included regardless of which side
it favours or what it proves or disproves. At the outset of a fraud examination, the examiner
should carefully determine what information will be needed to prove the case and attempt to
include only this information. A report should include only those matters that are relevant to
the examination. However, almost every investigation yields much information of which the
relevance is not immediately known. In such cases, it is best to opt for completeness.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Timeliness

A

Timeliness of reports is extremely important because it tends to enhance the accuracy of
witness testimony. Another aim of timeliness is to preserve the examiner’s memory of the interview(s). All interviews should be transcribed as soon as possible after the questioning. Upon completing the examination, the examiner should prepare a final or interim report (whichever is appropriate) as soon as possible.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Conclusions

A

based on observations of the evidence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

opinions

A

an interpretation of the facts

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

The fraud examiner can avoid problems of evidence maintenance by

A

simply documenting—in memorandum form—the receipt or release of all evidence.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

When operating under a lawful court order that compels a custodian to furnish original documents, the examiner should

A

copy those documents (preferably in the presence of the custodian). Then the examiner should
furnish the custodian with a receipt describing the documents copied or taken

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

After obtaining documents, the examiner should ___

A

secure them for evidence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

he most common types of note taking include __

A

manual, stenographic, and electronic

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Organisation of Information. Chronological

A

This method presents facts in the order in which they were uncovered.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Organisation of Information. By Transaction

A

If a multitude of documents support several instances of fraud, this information should be
presented by separating individual transactions

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Under no circumstances should the examiner prepare a communication with the idea that

A

the information will not be disclosed to adverse third parties.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

A fraud examination should adequately answer the classic questions of __

A

who, what, why, where, when, and how

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Fraud examination reports will most likely be read by the following individuals.

A
Company Insiders 
Attorneys
Defendants and Witnesses 
Press 
Juries
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Write each report in a style that is __

A

clear, concise, and to the point

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

The two cardinal sins of report writing are

A

vagueness and wordiness.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Common breaches of good basic writing include:

A

• Improperly placed or ambiguous modifiers (changes sentence context)
• Use of technical jargon, slang, and/or colloquialisms (places the burden to understand
on the reader)
• Use of unnecessary, high-flown verbiage (in an attempt to impress the reader)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Always use the ___ voice unless there is good reason to use the passive.

A

active (emphasis is on the subject)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

When writing a report, one should never use ___ to replace I or me

A

the writer

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Sentences that contain more information than the reader can comfortably absorb are known as

A

Rambling Sentences

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

A run-on sentence is ___

A

two or more sentences without proper punctuation to separate them

24
Q

Do not omit a __

A

required verb.

subject

25
Q

Avoid compound sentences __

A

ontaining clauses that have little or no logical relationship to one another

26
Q

A modifier (a word, a phrase, or a clause) is misplaced when it

A

modifies, or appears to modify, the wrong word or phrase.

27
Q

Paragraph Structure

A

State a paragraph’s main point in its first sentence. Subsequent sentences should support and
clarify that main point. For the purposes of report writing, paragraphs should be short.

28
Q

Report Structure

A
Background
Executive Summary
Scope
Approach 
Findings
Summary 
Impact 
Recommendations
29
Q

Background

A

The background section should generally be about two paragraphs. It should state very
succinctly why the fraud examination was conducted (e.g., an anonymous tip was received,
an anomaly was discovered during an audit, money or property was missing).

You may also state who called for the examination and who assembled the examination team.

30
Q

Executive Summary

A

For a simple fraud examination, the executive summary should be no more than four or five
paragraphs. For a more complex case, the summary may reach a page or two in length.

In this section, you should also summarize what actions you performed during the fraud
examination, such as reviewing documents, interviewing witnesses, or conducting analyses or
tests. It provides the reader with an overview of what you did during the examination
process.

At the end of this section, you should summarize the outcome of the examination.

31
Q

Scope

A

This section should consist of only one paragraph explaining what the scope of the fraud examination was

32
Q

Approach

A

This section gives a brief description of the following items:
• Fraud examination team members
• Procedures (generally, what documents were reviewed or what tests were conducted)
• Individuals interviewed

33
Q

Findings

A

This section contains the details of the fraud examination. It will generally consist of several
pages. In this section you should describe what tasks you performed and what you found.
Provide enough detail so that the reader understands what occurred, but not so much detail
that the reader begins to lose interest or becomes bogged down in the details. The reader wants to know how many invoices were forged, who was involved, how they did it, and what proof you have.

If the findings section is long, you may wish to use subheadings for particular topics or individuals to make it easier for the reader to stay organized.

The information can be presented either chronologically or by topic—whatever makes it
easier for the reader to follow.

34
Q

Summary

A

This section should be one or two paragraphs and should succinctly summarize the results
of the fraud examination. It should be similar to the outcome stated at the end of the
Executive Summary section.

35
Q

Impact

A

Here you should describe how the fraud affected the victim organisation. In this section you can provide an estimate of the dollar losses or any other time of tangible or intangible damage already suffered or that may occur in the future.

36
Q

Recommendations

A

This section is optional. There may be instances in which you wish to discuss remedial
measures or specific recommendations in a separate document. If you do wish to include
this section, you should state what follow-up action is necessary or recommended, including
remedial measures such as a review of internal controls, introduction of a hotline, or increased security.

37
Q

The basic reporting documents are:

A
•  Memoranda 
•  Exhibits, documents, or enclosures 
•  Indexes 
•  Cover page 
•  Transmittal letter  
The long-form report will consist of copies of these documents.
38
Q

Memoranda

A

Use memoranda to document all interviews and other pertinent information discovered
during the examination. Each memorandum should contain the following information where
appropriate:
• Heading
• File number or control number
• Name of person reporting
• Case name or subject
• Subject of memorandum
• Date
• Details of facts
• Interview was voluntary
• Indicate that one provided one’s identity
• The witness was informed of the nature of the inquiry
• Date of inquiry
• How the interview was conducted (in person, by telephone, etc.)
• If the interview was electronically recorded
• Facts learned during inquiry

39
Q

Cover Page or Letter

A

A cover page summarises the examination’s salient points. The cover page should be direct and

succinct. If a report is submitted to an outside agency (such as law enforcement or outside
counsel) , a cover letter should accompany it. The cover letter should recapitulate information in the report and summarise the principal weaknesses. It is not necessary to list all witnesses, only those most valuable.

40
Q

Exhibits

A

As a general rule, copies of exhibits should be included in the report and not attached
separately. However, bulky files (including working papers and similar exhibits) might be
attached separately and referred to in the body of the report. The chain of custody should be
maintained over original documents.

41
Q

Forms

A

A complete fraud examination report must document every step of the information-
gathering process. Because the orderly and legal presentation of evidence requires the
examiner to organise a great deal of information, the examiner should use the forms available to facilitate this task. As a general rule, these forms are kept in the file and not included in the report unless necessary.

42
Q

Consent to Search

A

A consent to search form documents the fact that a person has been informed of his legal
rights, stating that:
• The premises cannot be searched without a search warrant
• The person can refuse to consent to such a search
The signatures on the bottom of the form (subjects and witnesses) indicate that the person is voluntarily giving the examiner written permission to search the premises and to remove whatever papers, documents, or other property he might desire.

43
Q

Receipt for Property

A

A receipt for property form is a multipurpose document used to list items of evidence that have
been received, returned, or released. This form includes the following information:
• Date of transfer
• Property owner’s name
• Owner’s address
• Description of item(s)
• Signature lines (“Received by” and “Received from”)

44
Q

Telephone Recording Consent

A

A telephone recording consent form stipulates where, when, and with whom telephone conversations can be recorded. This form states that the subject has granted permission without threats or promises of any kind and it must be signed by the subject and witnesses. Be cautioned that the form alone does not make the conduct illegal or legal.

45
Q

Consent to Record

A

A consent to record form documents the fact that an individual has given the examiner
permission to record specific conversations. This form must be signed and witnessed. It
details:
• The name of the individual
• His address
• The location of the conversation(s)
• Who might record the conversation(s)
• The name of the subject(s) with whom the individual might converse
• The date(s) of the conversation(s)

46
Q

Customer Consent and Authorisation for Access to Financial Records

A

This form authorises a financial institution to disclose the customer’s own records to the
examiner or other specifically listed individuals. It must be signed by the account holder.

47
Q

Evidence Control Log

A

In the case of significant items of evidence, it might be advisable to prepare an evidence control
log, a form that documents:
• The evidence control centre location
• The bank safe-deposit box location
• Other evidence location
• The signature(s) of person(s) placing in or removing evidence from repository
• The reasons why evidence was moved
• The file case number
• The time(s) and date(s) authorised individuals entered and departed evidence Repository

48
Q

Link-Network Diagrams

A

show the relationships between people, organisations, and events

49
Q

Summaries of Witnesses’ Statements

A

Reduce voluminous testimony and witness statements to summary form in order to identify
inconsistent statements and to permit quick review. To identify pertinent passages, indicate briefly the topic being covered at a given point, and provide a synopsis of the statement. Keep the synopsis as succinct as possible

50
Q

Engagement letters have four basic parts:

A

opening, body (long or short), terms, and close

51
Q

The Long Form

A

The examiner describes the procedures in detail and limits the scope of an examination to the procedures defined. It is not recommended for use in engagements requiring the investigation of fraud allegations and a concluding opinion on the existence of fraud.

At the onset, the examiner might not know what procedures will be necessary to resolve the
allegation. Consequently, it is difficult to describe, with any precision, the anticipated procedures before the examination begins.

52
Q

The Short Form

A

outlines the general scope of the engagement. he short form might also confirm if the examiner has access to any personnel or documentation deemed necessary to carry out the assignment. This type of engagement letter is best used for work that will ultimately require an opinion on a fraud allegation.
Because the examiner will not know the nature of the alleged fraud at the onset, it is best to not limit the examination’s scope

53
Q

Terms

A

The terms paragraph includes the fee, either flat rate or hourly, and the method of payment.
This is an excellent time to ask for a retainer and to describe the billing procedures. Also address the issue of out-of-pocket expenses. If travel is required, discuss the anticipated cost of travel and the number of trips.

54
Q

Close

A

In the closing section, thank the addressee for the opportunity to work with him. Provide a
phone number where you can be reached and any special instructions, such as cell phone and fax numbers. Ask the addressee to sign one copy, and return it in the envelope. Don’t forget to supply a signature plate for the returned letter and a self-addressed stamped envelope.

55
Q

Indemnity Clause

A

The indemnity must be broad enough to cover the fraud examiner’s legal expenses, provide for independent counsel, and protect the fraud examiner from liability in case of an adverse
finding, but it should also provide for the cost of time and expenses of the fraud examiner at the examiner’s usual hourly rate

56
Q

Opinions

A

The Certified Fraud Examiner is often asked for an opinion about the existence of fraud. He might be engaged to perform fraud deterrence services or to resolve a fraud allegation.

In the former instance, the opinion will address the strengths and weaknesses of the client’s
current fraud deterrence system and include recommendations to strengthen that system. If
specific instances of possible fraudulent conduct are uncovered, those should also be addressed.

In the latter situation, the examiner must be attentive to the Certified Fraud Examiner’s
Code of Professional Ethics, in that:

“no opinion shall be expressed regarding the guilt or innocence of any person or party.”

There are three possible outcomes of a fraud examination: evidence was obtained that
supports the allegation of fraud; evidence was gathered that does not support such an
allegation; and inconclusive evidence was gathered. In the first outcome, the opinion will vary depending on whether the perpetrator confessed to the alleged crime. In the second outcome, the examiner can state that the evidence does not support the fraud charge. The examiner is not able to declare that there was no fraud. In the final outcome, the examiner can state that the evidence is inconclusive; it neither supports nor refutes the allegation.