Newsroom
CAQ Offers View on Testing Journal Entries to Spot Fraud
Compliance Week (Subscription required for full article)
December 12, 2008
Compliance Week's Tammy Whitehouse reports that the Center for Audit Quality has "developed a practice aid with the help of auditors from its various member firms for testing journal entries based on the requirements of AU Section 316, 'Consideration of Fraud in a Financial Statement Audit'." CAQ Executive Director Cindy Fornelli said the practice alert is part of the Center's efforts to help audit firms develop more effective methods to prevent and detect fraud. "Every firm and every company makes journal entries in different ways. There is no uniform way. That makes the auditor's job harder because there's no uniform way to look for fraud."
Whitehouse adds that, "[o]n a longer term basis ... the CAQ will be working with the PCAOB in helping to develop a national center for fraud prevention and detection best practices. The Treasury Advisory Committee on the Auditing Profession suggested the PCAOB develop such a center to help advance the practice of deterring and identifying fraudulent financial reporting."
