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Chapter eight

     Auditor responsibilities regarding electronic and traditional fraud.

     In this chapter we will cover the following points

     a. The definition of fraud
     b. Difference between fraud and errors
     c. Types of fraud
     d. Auditing standards related to fraud
     e. Auditor responsibilities regarding fraud
     f. Conditions for fraud to happen & Fraud Triangle &Fraud diamond
     g. Electronic fraud & it`s tools in time of big data
     h. Using fraud prediction models

                                  First definition of fraud

            fraud is defined as intentional misstatement of financial statements.
     Purposedly Performed by employees, management or others to achieve illegal
     personal benefit whether in traditional accounting environment or electronic
     accounting environment.

                  Second: Difference between fraud and errors

     Although both of them results in misstatements but they are totally different where:

                  Fraud                             Errors

     Intention    Intentional misstatement          Unintentional
                                                    misstatement

      Parties     By Employees, Management or       By Employees
     involved           other internal parties

     Concealment  Employees perpetrating the fraud  employees making errors
         plans      attempt to conceal the fraud    do not attempt to conceal

                                                             the error

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     ‫جميع الحقوق محفوظة ـ الإعتداء على حق المؤلف بالنسخ أو الطباعة يعرض فاعله للمسائلة القانونية‬
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