This tool outlines different types of fraud and their respective financial performance indicators.
It summarizes some of the “red flags” within an entity’s financial performance that indicate the potential existence of embezzlement, financial statement fraud and other illegal acts (e.g., bribery, kickbacks, price-fixing, etc.). Some of these events have a direct impact on the financial statements of a company involved. Others may have an indirect impact because of fines, penalties and market impacts that may result from fraud and illegal acts. In evaluating financial performance, normal audit techniques can also be supplemented by looking for items that fail fraud-finding tests (i.e. follow the cash, etc.).