Internal Accountant's Report Essay

Internal Accountant’s Report
Jessica Weber
La Toyia Tilley
January 9, 2012
University of Phoenix



Internal Accountant’s Report
The impact of occupational fraud and abuse on the company
Occupational fraud and abuse is a form of corruption that is used to better one’s personal advancement by either deliberately misusing or by misapplication of his or her’s employer’s assets or resources. The three main factors of occupations fraud and abuse are greed, wages in kind, and unreasonable expectations (Wells, 2011, pp. 419-420). Occupational fraud and abuse can cause the company to have a devastating effect by losing millions of dollars, damaging the company’s reputation, and can cause the company’s management to look like they lack the ability of doing their job.
U.S. governmental oversight of accounting fraud and abuse and its affect on the company
Ever since the “recent business failures such as Enron, Global Crossing, WorldCom, and many others” (Latshaw, 2003, p. 13), the U.S. government has been forcing stricter rules and regulations on companies and auditors with the use of the Sarbanes-Oxley Act. There are several restrictions that the Act has for the accounting profession. The first being the creation of the Public Company Accounting Oversight Board (PCAOB), which is made up of five members that are “completely independent of the accounting profession” (Latshaw, 2003, p. 13). This board has the power to inspect auditing operations of public accounting firms, and “to set and enforce auditing, attestation, quality control and ethics standards for public company auditors” (Latshaw, 2003, p. 13). Another restriction is that the Act also lists several consulting services that are now considered to be prohibited:
• bookkeeping
• information systems design and implementation
• appraisals or valuations services
• actuarial services
• internal audits
• management and human resources services
• broker/dealer and investment banking services
• legal...