1. abuse
   1. misuse employee discounts
   2. take extended lunch break
   3. come late
   4. use sick leave when not sick
   5. work slow
   6. personal use of organization product
2. people
   1. Edward Sutherland
      1. white-collar crime
      2. theory of differential association
      3. crime is learned
   2. Donald cressey
      1. cressey's hypothesis
         1. trust violators
         2. technical skills
         3. nonsharable problems.
         4. general information
      2. offender違法者 types
         1. independent businessmen
         2. Long-term violators
         3. absconders 潜逃者
      3. 3 elements for trust violation
         1. perceived motive
         2. perceived opportunity
         3. ability to rationalize
   3. Dr. Steve Albrecht
      1. CFE
      2. 1980 study
      3. Fraud scale
         1. situational pressures
         2. opportunities to commit
         3. personal integrity
   4. Richard C. Hollinger
      1. Workplace conditions
      2. perception of management
      3. Controls
         1. Enforcing sanctions
         2. publicizing sanctions 制裁
3. Fraud triangle
   1. pressure
   2. opportunity
   3. rationalization
4. misappropriations
   1. skimming schemes
      1. corruption
      2. asset misappropriation
         1. Cash
            1. skimming
            2. Larceny
            3. Fraudulent disbursements
         2. Inventory & other assets
            1. misuse
            2. Larceny 盗窃
      3. Fraudulent statements
   2. Assets
      1. Future economic benefits
      2. Intangible
         1. Hard to misappropriate
      3. Tangible
         1. Cash, AR
         2. Inv, P&E, investments
      4. supplies and information
   3. Accounting equation
      1. A = L + OE
      2. Balance sheet affected dollar for dollar of misappropriation
      3. The asset side of equation is what is affected by misappropriations
      4. The corresponding affect is to Owner's Eqity
   4. Income statement
      1. REV - Exp = Profit (Loss)
      2. A misappropriation filters through the income statement to the owner's equity on the balance sheet
      3. misappropriations are truly expense of doing business.
   5. Cash vs. Accrual accounting
      1. cash
         1. Income recognized when collected
         2. exp incurred when paid
      2. Accural
         1. Income recognized when earned
         2. Expense recognized through matching
   6. Concealing asset misappropriations
      1. out of balance conditions
      2. false debits
         1. expense
         2. assets
      3. forced balances
      4. omitted credits
5. Skimming
   1. Define
      1. Theft of cash from victim entity prior to its entry in an accounting system
         1. off-book
      2. No direct audit trail
      3. Difficulty of detection
   2. asset misappropriations cases
      1. cash misappropriations
         1. 85.6%
      2. Non cash misappropriation
         1. 20.3%
   3. Frequency of cash misappropriations
      1. fraudulent disbursements
         1. 67.7%
      2. Skimming
         1. 19.6%
      3. Larceny
         1. 13.3%
   4. sales skimming
      1. method
         1. employee pockets the proceeds of the sale
         2. employee makes a sale of goods or services, collects the payment, and makes no record of the transaction
         3. without a record of the sale, there is no audit trail
      2. ways
         1. cash register manipulation
            1. No sale or other non-cash transaction is recorded
            2. cash registers are rigged so that sales are not recorded on the register tapes.
            3. No receipt is issued
         2. After hours sales
            1. Sales are conducted during non-business hours without the knowledge of the owners.
         3. Skimming by off-site employees
            1. Independent salespeople
            2. Employees at remote locations
            3. branches or satellite offices away from the primary business site
         4. Poor collection procedures
         5. Understated sales
            1. sales is recorded for a lower amount than was collected
            2. Price of sales item is reduced
            3. Quantity of items sold is reduced
         6. Theft in the mail room
            1. incoming checks
            2. incoming checks are stolen and cashed
            3. customer's account is not posted
      3. Preventing and detecting sales skimming
         1. Maintain a viable oversight present at any point
         2. create a perception of detection
         3. install video cameras
         4. utilize customers to detect and prevent fraud
         5. All cash registers should record the log-in and log-out time of each user.
         6. off-site sales personnel should also be required to maintain activity log
         7. eliminate potential hiding places for stolen money
         8. incoming mail should be opened in a clear, open area free from blind spots and with supervisory presence
   5. Receivable skimming
      1. More diffcult than skimming sales
         1. There is a record of the sale
         2. Collection is expected
      2. Customers are notified when payment is not received and will most likely complain
      3. lapping
         1. Crediting one customer's account with payment received from another customer
         2. Keeping track of payments becomes complicated
         3. Second set of books is sometimes kept
      4. force balancing
         1. posting to the customer's account without depositing the check creates an imbalance condition
      5. Stolen statements
      6. Fraudulent write-offs or discounts
      7. Debiting the wrong account
      8. Document destruction