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Anatomy of computer accounting frauds

A. Seetharaman (Faculty of Management, Multimedia University, Malaysia)
M. Senthilvelmurugan (Faculty of Management, Multimedia University, Malaysia)
Rajan Periyanayagam (Faculty of Management, Multimedia University, Malaysia)

Managerial Auditing Journal

ISSN: 0268-6902

Article publication date: 1 October 2004



This paper introduces fraud as asset misappropriations (85 per cent of cases), corruption and fraudulent statements. Symptoms include accounting anomalies, lack of internal control environment, lifestyle and behaviour. The most effective tools for fraud detection are internal audit review, specific investigation by management, and whistle‐blowing. The paper details the fraud investigation process and the role of auditors as fraud examiners. The correlation of fraud perpetrators' personality with the size of losses is examined. Personality is analysed into age, gender, position, educational background and collusion. A strong system of internal control is most effective in fraud prevention. Fraud prevention procedures, targeted goals and improvements to system weaknesses feature in the paper. Fraud impacts on accounting transactions in accounts receivable, receipts and disbursements, accounts payable, inventories and fixed assets, and financial reporting. The monetary impact resulting from fraud is analysed by the type of victim and the amount of loss. Internal control and good employment practices prevent fraud and mitigate loss.



Seetharaman, A., Senthilvelmurugan, M. and Periyanayagam, R. (2004), "Anatomy of computer accounting frauds", Managerial Auditing Journal, Vol. 19 No. 8, pp. 1055-1072.



Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited

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