What four methods of investigation constitute the fraud triangle plus inquiry approach to investigations.
You are a fraud examiner who has been hired by Bellevue Company to carry out an investigation. Bellevue is a beverage company that has experienced increased shipments of beverages but no increase in revenue. Management suspects that inventory is being shipped to unknown places or is being stolen.
a) How could you use invigilation to help you determine if inventory is being stolen or shipped to unknown locations? Briefly explain how you would carry out this investigative procedure.
Assume that you have selected a random sample of 15 checks from a population of 800 checks. The checks you have selected are the following numbers: 664, 789, 650,136, 365, 538, 800, 657, 110, 136, 398, 645, 214, 544, and777. Based on this sample, evaluate the truth of the following statements regarding your findings. Describe why you feel each statement is true or false.
a) You have determined that Check No. 365 was not properly signed and was paid to a fictitious vendor. You conclude that fraud exists in the population.
b) You have determined that no fraud exists in the sample of 15 checks you evaluated. You conclude that no fraud exists in the population.