EXECUTIVE SUMMARY The top-side journal entry is most susceptible to fraud by management override. It’s possible to make adjustments in subledgers, but this requires collusion with other organizational departments, which is much harder to accomplish. The most frequent types of management fraud involve fictitious or premature
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Forensic services
Whose Fraud?
The statute of limitations does not protect a taxpayer from a deficiency assessment for fraudulent returns when the fraud was committed by a preparer, the Tax Court ruled. In 2005, Vincent Allen was assessed a deficiency of $12,212 for income taxes in 1999 and 2000, based on false itemized deductions
IRS Targets Foreign Tax Credit Generators
The Joint International Tax Shelter Information Centre—an organization of tax administrators from Australia, Canada, the United Kingdom and the United States—recently focused on transactions by U.S. taxpayers with foreign counterparts to generate foreign tax credits. The IRS in response proposed amendments to regulations section 1.901-2, which targets transactions involving U.S.
Fraud
Colorado has taken what may be a first-in-the-nation approach to combat fraud and ID theft with the creation of the Colorado Fraud Investigators Unit, a division of the Colorado Bureau of Investigation (CBI). While other states have regional fraud units, CBI officials say the new unit is the first of
Technology Boosts Counterfeit Circulation
The U.S. Secret Service seized $62 million of counterfeit currency in the 2006 fiscal year, up 69% from 2003. About 54% of the fake currency collected was produced digitally, most likely using home computers and printers; in 1996, only 1% was made using digital technology. Source: USA Today.
Collaborative Fraud Networks on the Rise
Cyber criminals must adapt their collection methods to remain undetected, and it seems they’re linking together to make this happen. The latest Symantec Internet Security Threat Report found the underground networks and servers used to sell stolen data are becoming increasingly collaborative. During the last half of 2006, the number
The World’s Dumbest Fraudsters: Roundup Edition
If you thought the 24-year prison sentence handed to former Enron CEO Jeffrey Skilling was severe, think again. A Chinese court has ordered Wang Zhendong to death for his role in a fraud case. Zhendong conned more than 10,000 investors out of $390 million by falsely convincing them that he
Heavy Price for Ignoring Levy Notice
In U.S. v. MPM Financial Group Inc., the Sixth Circuit scolded the defendant for exercising poor internal controls as it upheld a penalty for failure to comply with a notice of levy against one of its employees, who was also the corporation’s co-owner and president. Because the employer did not
Flexing Your Super Financial Sleuth Power
EXECUTIVE SUMMARY Benford’s law holds that the leftmost digit in many types of numerical data is a 1 nearly one-third of the time, with probability inversely proportional to the value of each increasing digit. This phenomenon can be harnessed to analyze data to detect values that
Optimistic Executive Outlook
SURVEY SAVVY CEOs reported their level of confidence in prospects for revenue growth over the next three years as: Very confident – 52% Somewhat confident – 40% Not very confident – 6% Not confident at all – 1% Don’t know/Refused – 1% Source: PricewaterhouseCoopers 10th Annual Global CEO Survey, www.pwc.com/ceosurvey
What Is Your Fraud IQ?
Think you can spot corruption in any of its many forms? Take this (deceptively) simple test to find out just how much you know. 1. Which of the following assets are most often pilfered? a. Cash b. Accounts receivable c. Inventory d. Intellectual property 2. Which of
Want to Teach? It’s Easier Now
SIGN OF THE TIMES T oday people change jobs—even careers—several times. CPAs aren’t immune to this trend, and many highly qualified practitioners find that as their lives and interests deepen they look to give back to their professional and academic communities. One way to do that is to teach at
Data Point: 70
Percentage of all new hires who will be women or minorities in 2008. Source: Bureau of Labor Statistics, www.bls.gov .
A Taxing Workload
NUMEROLOGY Americans worked an average 116 days last year to pay their taxes, with federal taxes accounting for 77 days and state/local taxes, 39 days. How does this measure up against your other major expenses? Housing and household operation: 62 days Health and medical care: 52 days Food: 30 days
Credit Security Benefits All
BUSINESS TRENDS Increase workers’ productivity by protecting their credit? That’s exactly what employers hope to do when they add identity theft protection to their list of offered benefits. ID theft victims spend, on average, 40 hours repairing their credit history and personal funds, most of which must be done during
Halt Pre-Approved Chaos
CONSUMER ALERT Tired of piles of “pre-approved” credit card offers filling your mailbox? Chances are if you use a credit card, you’re included on credit bureaus’ mailing lists, which are sold to outside parties for pre-screened credit card offers, marketing purposes and insurance solicitations. Under the Fair Credit Reporting Act,
Nigerian Scammers 1, County Treasurer 0
THE WORLD’S DUMBEST FRAUDSTERS Many Americans have received an e-mail or letter from Nigeria, claiming that the recipient can receive huge funds from an “over-invoiced” government contract or a wealthy individual who died without a will. In actuality, these are advance fee swindles where the victim must pay phony charges
Happy Customers Open Their Wallets
SURVEY SAVVY According to the American Customer Satisfaction Index (ACSI), customer satisfaction for the fourth quarter of 2006 peaked at 74.9 on a 100-point scale, the highest level recorded since its initial measurement in 1994 and up almost 2% from 2005. Satisfaction in the finance and insurance sector registered at
New Era of Performance Standards
GOLDEN BUSINESS IDEA Gone are the days of performance checklists, hastily reviewed during an employee’s annual review. Companies now use performance standards to design orientation and training plans, research customer service and development needs, and award performance bonuses. The National Federation of Independent Business ( www.nfib.com ) provides guidelines for
Whistleblowers Wanted
The government has decided that whistleblowers are its friends, and it is increasingly making efforts to nourish and protect them. This is evidenced by a provision of the Tax Relief and Health Care Act of 2006 that increased potential rewards to people who provide information on individuals
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How to find the right CAS clients
The key to success with CAS is selecting the best clients. Tools like ideal client profiles (ICPs), buyer personas, and even artificial intelligence can help identify the businesses that best fit each CAS practice.
From The Tax Adviser
March 31, 2026
Current developments in taxation of individuals: Part 1
March 31, 2026
Current Developments in Taxation of Individuals: Part 1
March 6, 2026
