1. FORENSIC ACCOUNTING - BA124 – Spring 2015 Today’s Topics n Concealment Investigation Methods

2. FORENSIC ACCOUNTING - BA124 – Spring 2015 Concealment Investigation n Examination of documents n Routine audits n Extended computer searches n Physical asset counts

3. FORENSIC ACCOUNTING - BA124 – Spring 2015 Documentation n Documents do not forget …but n Keep in mind these cautions n Maintain chain of custody n Provide unique markings n Organize the evidence effectively n Strive to obtain original documentation n Consider use of Document Experts

4. FORENSIC ACCOUNTING - BA124 – Spring 2015 Auditing & Sampling n Recalculation n Reasonableness n Documentation n Confirmation n Observation n Physical examination n Inquiry Statistical sampling plays a significant role here. But be careful of sampling and non- sampling errors. See discussion of discovery versus computer sampling.

5. FORENSIC ACCOUNTING - BA124 – Spring 2015 Hard-To-Get-Documents n Subpoena n Search warrant n Voluntary consent

6. FORENSIC ACCOUNTING - BA124 – Spring 2015 Today’s Topics n Why Studying Conversion is Important n Sources of Information n The Role of Net Worth Calculations n Miscellaneous Articles and Cases

7. FORENSIC ACCOUNTING - BA124 – Spring 2015 Role of Conversion Analysis n Helps determine the extent of the fraud n Serves as a facilitation for confession

8. FORENSIC ACCOUNTING - BA124 – Spring 2015 Sources of Information (Study pages 254-261) n Variety of sources n Federal government sources n State government sources n Local government sources n Financial institution records n Public databases n Internet sources Don’t try to memorize the details of these sources. Know how to use some of them.

9. FORENSIC ACCOUNTING - BA124 – Spring 2015 Net Worth Method n For use in estimating “Funds from Unknown Sources” n Calculation: n Assets - Liabilities = Net Worth n NW c - NW P = Net Worth Increase n NWI + Living Expenses = Income n Income - Known Sources = Unknown Sources