The Red Flags of Fraud: Internal Auditors’ Knowledge of the Business Makes Them Ideal Candidates to Detect Unethical Behaviors

Internal Auditor, October 2016

Posted: 7 Mar 2019

See all articles by Norbert Tschakert

Norbert Tschakert

Salem State University; Salem State University

Belverd E. Needles

DePaul University

Mark A. Holtzblatt

Cleveland State University

Date Written: February 15, 2016

Abstract

We discuss how technology enables companies to include early warning indicators in their accounting information system and how a more proactive search for red flags can help a company to reduce fraud and improve management’s reaction to adverse events. In 2013, the SEC started its Accounting Quality Model (AQM) which utilizes red flags based on past financial statement fraud cases to calculate a score indicating possible fraud. Examples for red flags include accounting or documentary red flags, behavioral red flags or analytical red flags.

Keywords: fraud, forensic accounting, red flags

Suggested Citation

Tschakert, Norbert and Tschakert, Norbert and Needles, Belverd E. and Holtzblatt, Mark A., The Red Flags of Fraud: Internal Auditors’ Knowledge of the Business Makes Them Ideal Candidates to Detect Unethical Behaviors (February 15, 2016). Internal Auditor, October 2016, Available at SSRN: https://ssrn.com/abstract=3335217

Norbert Tschakert (Contact Author)

Salem State University ( email )

352 Lafayette Street
Salem, MA 01970-5353
United States
978-542-6627 (Phone)

HOME PAGE: http://https://directory.salemstate.edu/profile/norbert.tschakert

Salem State University ( email )

352 Lafayette St
Salem, MA 01970-5353
United States
9785426627 (Phone)

HOME PAGE: http://directory.salemstate.edu/profile/norbert.tschakert

Belverd E. Needles

DePaul University ( email )

1 East Jackson Blvd.
Chicago, IL 60604
United States
312-362-5130 (Phone)
312-362-6208 (Fax)

HOME PAGE: http://fac.comtech.depaul.edu/bios/bneedles.htm

Mark A. Holtzblatt

Cleveland State University ( email )

1860 E 18th St #420
Cleveland, OH 44114
United States
216-875-9711 (Phone)

HOME PAGE: http://facultyprofile.csuohio.edu/csufacultyprofile/detail.cfm?FacultyID=M_HOLTZBLATT

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