ABSTRACT
The Merriam-Webster Dictionary defines fraud as the "intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right," and also as "an act of deceiving or misrepresenting." Fraud is intentional and often followed by concerted efforts to conceal the act. Fraudsters often know how to perpetrate and conceal their crimes because they know the internal controls in place and the limitations of these internal controls. Frauds are perpetrated by parties and organizations to obtain money, property, or services; to avoid payment or loss of services; or to secure personal or business advantage. Fraud is intentional and often accompanied by deliberate efforts to conceal the act. Internal auditors should conduct afraud risk assessment to identify areas where fraud could occur and perform tests based on known or suspectedfraud schemes. Segregating incompatible duties is highly recommended to limit the potential for fraud.
