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Discussant's Response to Auditing Implications Derived from a Review of Cases and Articles Related to Fraud Henry J. Murphy Arthur Andersen & Co. I appreciate this opportunity to participate in the Fifth Annual Auditing Symposium sponsored by The University of Kansas. Not only is it a personal honor but it will also be very helpful to me as a member of the AICPA Standing Committee on Methods of Perpetration and Detection of Fraud. First of all, I want to compliment the authors on their study. I personally believe it was a study long overdue, and I can share their frustration in trying to "get to the facts and issues," so to speak, because our AICPA Task Force has also been frustrated in trying to obtain similar information from various governmental bodies, accounting firms, etc. The authors properly commented on this fact by stating that "many of the agencies and prisons responded they could not comply with our request" (for information) and went on to state that in their review of the 72 past cases of fraud, they attempted to determine the fraud-related variables which were present in each of the cases in order to establish a "red-flag'' checklist which could be helpful to auditors in detecting and deterring management fraud. They further stated that in reviewing various articles, etc., it was most difficult to identify these variables because "certainly the authors who wrote about the cases probably had a perspective much different than ours.'' Problems Encountered I think the two aforementioned problems (or limiting factors, as the case may be) are extremely important for all of us who are interested in the subject to understand and be aware of in reaching any conclusions as to where we go from here, whether in terms of further research, using a "red-flag" approach in our auditing practice, or in the teaching environment. I will come back to these problems later but, in any event, I think the authors have done a good job of compiling some excellent research on a very complex issue. The authors comment on the fact that they used 72 past cases of fraud to validate the fraud-related variables and go on to compare the typical fraud perpetrator to incarcerated prisoners and to college students. However, I could not determine how the 72 cases were selected, nor did I understand why the comparison was made to college students as a control group. Further, I wasn't sure what college students were included; i.e., from a single university or a cross-section of all universities. I think it would be helpful if these points could be expanded. 120
Discussant's response to auditing implications derived from a review of cases and articles related to fraud
Murphy, Henry J.
Nichols, Donald R., ed.
Stettler, Howard, ed.
Auditing Symposium V: Proceedings of the 1980 Touche Ross/University of Kansas Symposium on Auditing Problems, pp. 120-126
|Source||Published by: University of Kansas, School of Business|
|Rights||Contents have not been copyrighted|
|Format||PDF page image with corrected OCR scanned at 400 dpi|
|Collection||Deloitte Digital Collection|
|Digital Publisher||University of Mississippi Library. Accounting Collection|