Academic journal article Journal of Accountancy

Institute, Others Issue Antifraud Guide for Businesses. (Highlights)

Academic journal article Journal of Accountancy

Institute, Others Issue Antifraud Guide for Businesses. (Highlights)

Article excerpt

The AICPA joined six other professional associations in offering boards of directors, audit committees and corporate managers practical advice on preventing and detecting malfeasance ranging from unproductive behavior and minor theft to misappropriation of assets and falsified financial statements. This effort coincides with the ASB's recent issuance of SAS no. 99, Consideration of Fraud in a Financial Statement Audit (see "Auditors' Responsibility for Fraud Detection," page 28, and Official Releases, page 105), which is the cornerstone of the Institute's comprehensive antifraud and corporate responsibility program. A new Antifraud Resource Center (www.aicpa.org/antifraud) on the AICPA Web site contains tools, information and support to help practitioners spot and thwart fraud.

The seven associations presented their recommendations in a document titled Management Antifraud Programs and Controls (www.aicpa.org/antifraud/management) that the AICPA appended to SAS no. 99 as an exhibit. In their view businesses that implement three key practices will improve their ability to conserve revenue, enhance their market value, avert civil lawsuits and maintain a positive corporate image.

* Create a culture of honesty and high ethics. As role models for other employees' behavior, directors and officers have a unique capability to promote policies that represent all stakeholders' interests. The recommendations therefore focus on how senior managers can fulfill this responsibility. One way, for example, is to clearly communicate to employees management's desire to achieve its strategic goals, but not at the expense of truthful financial reporting. …

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