Page 121 - Auditinf Electronic System

▪ Turnover in accounting personnel or other deficiencies in accounting and
information processes can create an opportunity for misstatement.

▪ Weak internal controls where there is accessible cash or with inventory or other
valuable assets, especially if the assets are small or easily removed.

Third: Rationalization: Represent an attitude, character, or set of ethical values
exists that allows management or employees to commit a dishonest act, or
they are in an environment that imposes sufficient pressure that causes
them to rationalize committing a dishonest act.

▪ If employees are always underpaid. Chances of cash embezzlement is higher
▪ If the CEO or other top managers display a significant disregard for the

financial reporting process, such as consistently issuing overly optimistic
forecasts, or they are overly concerned about meeting analysts’ earnings
forecasts, fraudulent financial reporting is more likely.

121

121

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