Fraud Risk Management

Fraud Risk Management: providing insight into fraud prevention, detection and response
The Association of Certified Fraud Examiners (ACFE) states that fraud can “encompass any crime for gain that uses deception as its principal modus operandus”. Regardless of the size and complexity, all organizations are subject to fraud risks while only relatively few major frauds are picked up by the media, huge sums are lost by all kinds of businesses as a result of the high number of smaller frauds that are committed. Latest surveys show that organizations are losing an estimated 5% of their annual revenues to fraud. Therefore, organizations should increase their focus on fraud risk and take the opportunity to consider, enact and improve measures to detect, deter and prevent fraud. To do so, it is a pre-requisite for organizations to have a strong anti-fraud stance and proactive, comprehensive approach to combating fraud.

Roles and responsibilities of stakeholders in managing fraud Risks

The division of responsibilities for fraud risk management will vary between organizations, depending on size, industry, culture and other factors. The following are some of the stake holder which can be adapted to suit specific circumstances.

Management’s fraud-related responsibilities

The legal foundation for management’s fraud-related responsibilities
Management’s responsibility for internal controls
Management’s responsibility for an effective corporate compliance and ethics program
Document retention policies

Auditors’ fraud-related responsibilities

External audit standards related to fraud
Internal auditor’s fraud-related responsibilities
International standards for government auditing

Fraud-related responsibilities of other stakeholders: -

Human resources
Chief financial officer
Legal advisers
Information system /information technology staff
Anti-fraud officer
Public relations
External consultants

Fraud Investigation and Corrective Action

Organization’s objectives with respect to dealing with fraud
Why conduct a fraud investigation?
What Fraud Examination Entails
Managing the Investigation


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Bole Sub-city
Woreda 08 cadister, B/K
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