ABSTRACT
This chapter examines the techniques available to the auditor in order to identify the red flags and indicators that fraud may be occurring or may have occurred in the past as well as the obtaining of forensically acceptable data analytical evidence. Red flags may be seen as early warning indicators that the risk of fraud in particular area is either higher than is normally tolerable or has increased over a period. Computer fraud itself takes a variety of forms. In traditional, transaction-based systems, changes to source documents prior to processing but after authorization are a common fraudulent technique involving no additional access to computer systems. In modern online systems, a variety of techniques, including impersonation of authorized users and piggybacking on authorized access as well as introduction of fictitious transactions are all potential techniques. With the introduction of e-commerce, fraud opportunities have abounded due to the significant size of potential losses as well as the speed of effective asset transfer.
