Frequent Frauds Found in Governments and Not-for-Profits

OVERVIEW A ROADMAP FOR TODAY’s COURSE

Often those taking this course find it difficult to believe these fraud cases could actually occur. Auditors are also sometimes skeptical the situations presented would actually result in material financial statement fraud. On the other hand, others often believe any fraud is material when it occurs in governmental or not-for-profit (NFP) entities, as they most often involve public funds. Those working in government and NFP entities find the fraud cases in this course to be realistic.

2016 OCCUPATIONAL FRAUD REPORT

Every two years the Association of Certified Fraud Examiners releases a report based on cases of occupational fraud as reported by the certified fraud examiners investigating them. The 2016 Report to the Nations on Occupational Fraud and Abuse summarizes 2,410 fraud cases of which 1,038 (49 percent) relate to frauds in the United States, with governmental and public administration entities representing almost 11 percent of the victim organizations. Health care, education, religious, charitable, and social services entities represent 15 percent of the cases investigated. Although these and governmental entities represent some of the industries with the greatest frequency of fraud, the amounts of the fraud losses are not as large as those of other industries. Governmental entities report a median loss of $133,000, while health care, education, religious, charitable, and social services entities report median losses of $120,000; ...