Fraud Analytics for Internal Auditors Certificate

Who will benefit from this program?

This program is for internal auditors who want to gain recognition of their application of data literacy knowledge to fraud risks. Upon completion of the program, participants will be eligible to sit for the assessment in order to earn the certificate.

Certificate Objectives

• Understand the fundamentals of fraud, its impact on the organization, and the responsibility of internal audit to consider fraud in all aspects of the audit.
• Identify the various types of fraud schemes.
• Understand the tools and technology available to assist auditors with fraud analytics.
• Understand the difference between descriptive, predictive, and social analytic techniques used in fraud data analytics.
• Understand the fraud analytics methodology and incorporate that methodology into audit planning and testing.
• Apply analytic techniques and testing strategies to identify red flags associated with common fraud schemes.

Certificate Topics

Fundamentals of Fraud

• Fundamental concepts of fraud, including its various definitions and implications.
• Effects of fraud on individuals and organizations, both financially and reputationally.
• Psychological and situational factors that drive individuals to commit fraud, including common characteristics and profiles.
• Different types of fraud, including financial, occupational, and cyber fraud
• Role and responsibilities of Internal Audit in detecting and preventing fraud.
• Principles and practices of fraud auditing, including techniques and methodologies.
• Red flags that may indicate fraudulent activity and their importance in fraud detection.
• Differences between fraud risk statements, fraud scenarios, and fraud schemes, and their relevance in fraud risk management.

Understanding Fraud Analytics

• Fraud analytics and its importance in the context of internal auditing.
• Key components and tools used in fraud analytics.
• Benefits of using fraud analytics in detecting and preventing fraud and how fraud analytics can enhance the efficiency and effectiveness of internal audits.
• Scenarios and areas within an organization where fraud analytics can be applied and successfully implemented within different industries.
• Methodologies and techniques used in data collection, analysis, and interpretation for fraud detection.

Fraud Analytics Techniques

• The different forms of data and what is included in a data set used for analytics.
• Testing strategies that can be used with the fraud methodology.
• Descriptive analytical techniques used to uncover red flags that point to potential fraud through analytics.
• How predictive and social analytical techniques are used by organizations to find and prevent fraud.

Methodologies – Planning and Collecting

• The importance of using an established methodology to systematically look for fraudulent activities.
• The Fraud Analytics Methodology.
• How to apply the methodology to a fraud scheme.

Methodologies – Processing and Analyzing

• The significance of data normalization in the data analysis process.
• Key components of data cleaning and standardization.
• The ability to assess data for usability, completeness, cleanliness, and reliability.
• Application of basic techniques for normalizing data, including error correction, and format standardization.
• Iterative nature of data preparation and its impact on the overall analysis.
• Importance of thorough data cleaning as a foundation for accurate analysis.

Methodologies – Reporting and Evaluating

• Evaluate the importance of communicating with key individuals, such as the Chief Audit Executive (CAE), about the progress and findings throughout the audit process.
• Emphasizing the need for audit documentation to be thorough and replicable by an informed and competent person.
• The application of the principles and best practices of formal communication and documentation throughout the fraud audit methodology, not just at the end of the audit.
• Importance of maintaining consistency in the message about the fraud audit, regardless of the medium or formality of the communication (e.g., formal reports, emails, phone calls).
• Adhering to organizational and reporting standards for their organization and the relevant professional standards, ensuring that all communications and documentation meet these requirements.

Fraud Schemes – Corruption & Asset Misappropriation

• Each of the three major fraud scheme categories in the fraud tree.
• Common schemes within each category through real-world examples.
• Analytical tests to detect red flags associated with different fraud schemes.
• Potential to uncover fraud by interpreting the results of these analytical tests.
• Utilize the methodology and techniques from previous units to incorporate fraud analytics into audit plans.
• Fraud analytics skills to address various potential organizational fraud schemes.
• Strengthen the ability to detect and analyze fraud schemes beyond the examples provided in the lessons.
• Skills to continuously improve fraud detection and prevention strategies.

Financial Statement and other Fraud Schemes

• Identify prevalent fraud schemes within each category of the fraud tree using real-world case studies.
• Apply analytical procedures and tests to spot red flags linked to different fraud schemes.
• Uncover fraud by analyzing the outcomes of these analytical tests.
• Develop fraud analytics skills to tackle various potential organizational fraud schemes.
• Enhance skills to continuously refine fraud detection and prevention strategies.