WEEK 3 : COMPUTER FRAUD Flashcards
Threats to accounting information systems
natural/political disasters
software errors and equipment malfunctions
unintentional acts
intentional acts
categories of fraud
misappropriation of assets
fraudulent financial reporting
conditions for fraud
ie. fraud triangle and triangles within those
PRESSURE
- employee pressure triangle ( financial, lifestyle, emotional)
- financial statement pressure triangle ( financial management, industry conditions)
OPPORTUNITY TO: (opportunity triangle)
- commit, conceal, convert to personal gain
RATIONALIZE ( triangle)
- justify behaviors, attitude that rules don’t apply, lack of personal integrity
computer fraud classifications (types)
- input
- processor
- computer instruction
- data
- output
preventing and detecting fraud - making less likely to occur
ORGANISATIONAL:
- culture
- structures that minimize
- assignment of authority & accountability
- policies and communication
SYSTEMS:
- security policies
- change management and development controls
preventing and detecting fraud - making it difficult to commit
ORGANIZATIONAL:
Develop strong internal controls
Segregate accounting functions
Use properly designed forms
independent checks and reconciliations of data
SYSTEMS:
Restrict access
System authentication
Implement computer controls over input, processing, storage and output of data
Use encryption
Fix software bugs and update systems regularly
Destroy hard drives when disposing of computers
preventing and detecting fraud - improve detection
ORGANIZATIONAL:
Assess fraud risk
External and internal audits
Fraud hotline
SYSTEMS:
Audit trail of transactions through the system
Install fraud detection software
Monitor system activities (user and error logs, intrusion detection)
preventing and detecting fraud - reducing losses
ORGANISATIONAL:
-insurance
- Business continuity and disaster
recovery plan
SYSTEM:
- Store backup copies of program and data files in secure, off-site location
- Monitor system activity
