The Importance of the Internal Audit in a Small Business Essay

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The Importance of the Internal Audit in a Small Business Fraud means a variety of offenses involving dishonesty or conceiving someone or an entity of making monetary or personal gain. When referring to monetary interest, the companies, no matter how small or big, private or public, profit or non-profit, are all subject to fraud, waste and embezzlement. According to Marquet International, Ltd., analysis of more than 1,000 major embezzlement cases over the past three years reveals that the vast majority of the victim companies are privately held, small- and medium-sized businesses. (Marquet, 2010) The story of “The Spinster and the Dubious Investment” also happened in a small business. Francine Gordon was an intelligent and hard-working employee in Small Town Federal Credit Union (STFCU), and she had been the controller of this company for more than 15 years. Besides doing her own work, she also managed the data-processing systems, and always helped out in other departments and proceeded over several projects. Despite the fact that she was kind of dictatorial and moody, the CEO of STFCU Susan Wren and many employees still tolerated and showed respect to such a model employee. Gordon was not married, had no children, seldom visited her faraway family, and had few friends, so she devoted herself in working. As a result, Wren granted Gordon more and more authority and autonomy during these years, so she controlled numerous areas of the company, such as accounting and the management of STFCU’s investment, which allowed her to make purchases and sales decisions about investments, although she was not an expert in investment analysis. Gordon relied on the advice of the credit union’s three approved brokers. Steven Edwards, one of the credit union’s investment brokers, who was a gentle man and always cared about Gordon, so Gordon had a crush on him. Although, the

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