Audit Questions

AN AUDIT WOULD ANSWER A LOT OF QUESTIONS

There has been much discussion about a UCO FORENSIC AUDIT.  First, the Grand Poohbah says yes, okay, - then reneges and says no, - then yes, then no.  The man is paranoid to be sure.

It would be done by three Villagers, two whom are CPA’s and the third a former UCO treasurer for a number of years.  And, it wouldn’t cost UCO, or anyone in the Village, a single penny.

Just what is the Poohbah afraid of?  Well, he could very well be afraid of 5.3 million dollars that was carelessly and negligently spent.  And now he’s gathering monies to do paving repair work, - like thousands of dollars that he’d like to draw down from a “General Fund” and whisk away the responsibility that he and his backroom button pusher surely have.

So, just what is a FORENSIC AUDIT?  It is an audit whose purpose is to use accounting procedures to collect evidence for the prosecution or investigation of financial crimes such as theft or fraud.  Forensic Audits may be conducted to determine wrongdoing occurred, or to gather materials for the case against an alleged criminal.

To the Grand Poohbah, it would be devastation.  He and his button pusher would need to tell the truth, the whole truth and nothing but the truth.

Perhaps more appropriate would be a FRAUD AUDIT.

1.    A FRAUD AUDIT is a meticulous review of financial documents, while one searches for the point where the numbers and/or financial statements do not mesh, and it is a compliance tool that is used by company management to meet its internal and regulatory obligation to guard against illegal activity.  The standard types of fraud include recording fake transactions, stealing, embezzling, bribery, extortion and kickbacks.

2.    When the doctoring of financial records for purposes of moving funds from certain dedicated categories to other ledger categories without proper identification or authorization, in order to establish an illicit manipulation of funds becomes evident, this action elevates to a FRAUD AUDIT. 

All of the evidence is there, - it just needs to surface.  The auditors take the broad step and actually elevate the characteristics of a transaction to determine if red flags exist that would indicate signs of certain types of fraud that auditors are trained to identify.

Hey, Poohbah, show the people that you’re not afraid, but be sure you get some advice from your button-pusher.

EDUARDO