After studying this chapter, you should be able to:

14-1 Describe the factors that influence an organization's vulnerability to fraud
14-2 Explain the difference between preventive and detective controls
14-3 Define and explain the objective of a fraud risk assessment
14-4 Discuss why organizations should conduct fraud risk assessments
14-5 Understand the characteristics of a good fraud risk assessment
14-6 Describe considerations for developing an effective fraud risk assessment
14-7 List actions that should be taken to prepare a company for a fraud risk assessment
14-8 Understand the steps involved in conducting a fraud risk assessment and how to apply a framework to it
14-9 Describe approaches to responding to an organization's residual fraud risks
14-10 Name important considerations when reporting the results of a fraud risk assessment
14-11 List actions management should take using the results of a fraud risk assessment
14-12 Explain how a fraud risk assessment can inform and influence the audit process


For the organization's fraud risks to be effectively managed, they must first be identified using a formal risk assessment. If performed and used correctly, a fraud risk assessment can be a powerful proactive tool in the fight against fraud for any business. Additionally, regulators, professional standard-setters, and law enforcement authorities continue to emphasize the crucial role ...

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