Question: You are a staff auditor on a very important audit engagement. You are assigned to audit two parts of your clients purchasing department. After several
You are a staff auditor on a very important audit engagement. You are assigned to audit two parts of your client’s purchasing department. After several days of studying purchase orders and sales invoices, you notice that three vendors have identical addresses. After further examination, you notice that the documents only have one of the two required signatures for purchases of those accounts. You decided to interview the purchasing manager in charge of those accounts, but you discover that he is “out to lunch.” While you are waiting for him, you notice through his office window a very nice Bose™ stereo system. It’s the same system you have been wanting, but will only be able to afford after you make partner. What symptoms of fraud exist?
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