10 Report writing Flashcards
(23 cards)
Characteristics of a well-written fraud examination report include which of the following?
A. Impartiality
B. Accuracy
C. Clarity
D. All of the above
D. All of the above
A well-written report contains the following four characteristics:
* Accuracy
* Clarity
* Impartiality and relevance
* Timeliness
The facts in a report should only be those relevant to the case, filtering out unnecessary details. Moreover, fraud examiners should not make determinations of guilt or innocence in their reports.
Suppose that a fraud examiner is going to testify at trial about an examination report for a complex case, and the report contains summaries of key documents that were created by someone other than the fraud examiner. Which of the following best describes what the fraud examiner should know about the documents underlying the summaries?
A. The fraud examiner only needs to review some of the documents underlying the summaries for quality assurance.
B. The fraud examiner does not need to review the documents underlying the summaries. IN
C. The fraud examiner must have read and analyzed every document in the case.
D. The fraud examiner should conduct a complete review of the documents underlying the summaries.
D. The fraud examiner should conduct a complete review of the documents underlying the summaries.
Sometimes cases involve thousands or even millions of documents, but someone must present a report on the review of those documents at trial. Such cases might make it impractical or impossible to timely analyze all of the documents. It is common for complex cases to require delegation of tasks to create an examination report, such as subordinates searching for key documents and creating document summaries.
One important problem in the preparation of reports and accounting summaries arises from delegation of tasks to subordinates. If the person giving evidence has not had direct knowledge of or has not examined the specific documents or prepared the accounting summaries, it might be possible that the expert will be trapped under the hearsay rule (if applicable). If tasks are delegated, it is important that the review process entail review of all work to original documentation on a 100-percent basis. It is also important to know the effect of the other assumptions on the conclusion or opinion reached in the report. It is often possible to trap an expert into giving alternative opinions based upon other assumptions that had not been considered. The work should be planned carefully enough in advance so that the work papers and supporting documentation do not show contradictory conclusions that the opposing side could seize upon.
When reporting the results of a fraud examination, the Certified Fraud Examiner generally should include his opinion regarding the credibility of the witnesses.
A. True
B. False
B. False
The fraud examiner should be careful not to include any statement of opinion as to the integrity or veracity of any witness, even if the fraud examiner is convinced that the witness is being untruthful. Truthfulness, or lack thereof, can be demonstrated through conflicting statements by the witness or suspect.
A link-network diagram is a type of chart used to show relationships between people, organizations, and events.
A. True
B. False
A. True
Link-network diagrams show the relationships between people, organizations, and events. In these diagrams, different symbols are used to represent different entities: a square can symbolize an organization; a circle, a person; a triangle, an event; and so forth. It does not matter which symbols are used as long as they are used consistently. In link-network diagrams, confirmed connections between entities can be represented by a solid line or enclosure within another symbol. Speculative or presumed relationships can be indicated by broken lines. To achieve its intended purpose, a graphic should always be clear. Therefore, these diagrams should not contain lines that are crossed, if possible.
When drafting a written fraud examination report, fraud examiners should, whenever possible, include technical jargon to demonstrate expertise in the accurate detection of fraud.
A. True
B. False
B. False
Fraud examination reports must show clarity. Thus, fraud examiners should try to avoid using jargon because the report might be read by people who are not familiar with esoteric or technical terminology. Use complex or technical terms in their proper contexts, and, where necessary, explain their meaning.
The primary purpose of an expert report is to document the results of a fraud examination.
A. True
B. False
B. False
A fraud examination report documents the results of a fraud examination and is generally created by one or more critical members of the fraud examination team. Documenting results is a particularly important function in fraud examinations. The fraud examination report conveys all evidence necessary to evaluate the case, and it can be used to corroborate previously known facts. An accurate report will add credibility to the fraud examination and to the fraud examiner’s work.
Fraud examiners who serve as expert witnesses in litigation are tasked with providing an expert report, which requires them to provide particular information about their qualifications, their opinions, the bases of those opinions, and various other pieces of information. The purpose of an expert report is to inform the parties, the judge, and the jury (if applicable) about the expert’s opinion of the case, as well as his credibility for commenting on such issues.
A fraud examiner is preparing his fraud examination report at the conclusion of a fraud investigation. When including information regarding the interviews conducted during the examination, the fraud examiner should:
A. Include only the facts provided by the witnesses that substantiate the fraud allegation.
B. Report the details of each witness interview in a separate memorandum.
C. Use signed copies of his notes from the interviews as the primary recording document.
D. Include all information provided by all the witnesses, regardless of the relevance.
B. Report the details of each witness interview in a separate memorandum.
Written fraud examination reports must be accurate. Inaccuracies will affect the credibility of the report and the report’s author. Each contact a fraud examiner makes during the course of a fraud examination should be recorded on a timely basis in a separate memorandum that documents the details of the interview. Ordinarily, there is no need to recapitulate testimony word for word in the report, but the fraud examiner should include all facts of possible relevance for accuracy’s sake.
Also, relevant facts should be included regardless of which side they favor or what they prove or disprove. The written report conveys all evidence necessary to evaluate the case, and it can be used to corroborate previously known facts. An accurate report will add credibility to the fraud examination and to the fraud examiner’s work. Additionally, requiring a written report will force the fraud examiner to consider his actions during an investigation by ensuring that he documents his process. A well-written report will also omit irrelevant information, thereby allowing pertinent facts to stand out.
Which of the following is a recommended method for organizing and presenting information in a fraud examination report?
A. By party
B. By the order in which the information was discovered
C. Chronologically
D. All of the above
C. Chronologically
Because of the amount of information and the number of documents that might be collected during a fraud examination, it is imperative that the fraud examiner properly organize the information. If circumstances permit, an information database should be established in the early phases of the case. Information can be presented either in chronological order or by transaction when writing the fraud examination report.
In contrast, during the evidence-gathering stage of an investigation, chronologically organizing the documents that will later be used in drafting the report is not recommended because it will make searching for relevant information more difficult. It is generally better to organize documents by transaction or by party while evidence gathering is still occurring.
When preparing a fraud examination report, which of the following opinions is permissible to include in the report?
A. Opinions on a party’s guilt
B. Opinions on the veracity of witnesses
C. Expert opinions regarding technical matters
D. None of the above
C. Expert opinions regarding technical matters
Fraud examiners must be cautious about stating their opinions. The fraud examiner must avoid stating opinions regarding the guilt or innocence of any person or party involved. The ACFE Code of Professional Ethics specifically prohibits statements of opinions regarding guilt or innocence, as this is the job of the judge or jury.
Similarly, the fraud examiner should be careful not to include any statement of opinion as to the integrity or veracity of any witness, even if the fraud examiner is convinced that the witness is being untruthful. Truthfulness, or lack thereof, can be demonstrated through conflicting statements by the witness or suspect.
Opinions regarding technical matters, however, are permitted if the fraud examiner is qualified as an expert in the matter being considered. For example, a permissible expert opinion might address the relative adequacy of an entity’s internal controls. Another opinion might discuss whether financial statements conform to generally accepted accounting principles.
Which of the following is considered a basic fraud examination reporting document?
A. Memoranda
B. Transmittal letter
C. Exhibits
D. All of the above
D. All of the above
Reporting formats vary widely. Some organizations, especially governmental investigative bodies, use report forms so that case information is provided in a consistent manner. The basic reporting documents are:
* Memoranda
* Cover page
* Exhibits, documents, or enclosures
* Forms
* Indexes
* Transmittal letter
Which of the following statements concerning documentation in a formal fraud examination report is most accurate?
A. The originals of important documents should be included in the report.
B. A reference to any important documents is sufficient.
C. A reference to the current location where the original documents can be found is sufficient.
D. Copies of important documents should be included in the report.
D. Copies of important documents should be included in the report.
Most evidence in fraud cases will be in document form, and when reporting the results of a fraud examination, it is best to include copies (not originals) of important documents in the formal report or in the attached appendices. Also, when operating under a lawful court order that compels a custodian to furnish original documents, the fraud examiner should copy those documents (preferably in the presence of the custodian). Then the fraud examiner should furnish the custodian with a receipt describing the documents copied or taken.
When drafting a fraud examination report, fraud examiners should write with the expectation that opposing legal counsel will have access to the information it contains.
A. True
B. False
A. True
When drafting a report, fraud examiners must consider who might end up reading it. Fraud examiners should keep in mind that the fraud examination report will be read by the general public and adverse parties. Under no circumstances should the fraud examiner prepare a communication with the idea that the information will not be disclosed to adverse third parties. Fraud examiners should draft their reports with this caveat in mind.
There are many parties that might read a fraud examination report, including:
* Company insiders (managers, board of directors, owners, investors, etc.)
* Attorneys (legal counsel, prosecutors, regulators, and defense counsel)
* Defendants and witnesses
* Media outlets
* Judges or juries
Which of the following is NOT a purpose of the follow-up/recommendations section of a written fraud examination report?
A. To make recommendations related to procedures and controls
B. To calculate the amount of loss caused by any misconduct identified during the investigation
C. To state necessary remedial measures for the organization to undertake
D. To identify any aspect of the investigation that remains outstanding
B. To calculate the amount of loss caused by any misconduct identified during the investigation
A follow-up/recommendations section is generally an optional part of a written fraud examination report. This section identifies any aspect of the investigation that remains outstanding, usually because it is outside the mandate of the investigator. This could include the recovery of property that is in the possession of third parties or the collection of information held by vendors or suppliers.
If requested, the fraud examiner might make recommendations related to procedures and controls; however, it is better for the fraud examiner to convey recommendations related to flawed internal controls and other organizational failings to management in person or in a separate document. If included in the primary report, this information could potentially be seized upon by defense attorneys at a trial or by representatives at an unemployment hearing to push blame away from the suspect’s actions and toward the organization’s shortcomings.
Follow-ups or recommendations should state what action is necessary or recommended, including remedial measures such as a review of internal controls, the introduction of a fraud hotline, or an increase in security.
Which of the following is a function of a fraud examination report?
A. To convey all the evidence necessary for other parties to thoroughly evaluate the case
B. To corroborate previously known facts
C. To add credibility to the fraud examination and to the fraud examiner’s work
D. All of the above
D. All of the above
A fraud examination report documents the results of a fraud examination and is generally created by one or more critical members of the fraud examination team. Documenting results is a particularly important function in fraud examinations. The fraud examination report conveys all evidence necessary to evaluate the case, and it can be used to corroborate previously known facts. An accurate report will add credibility to the fraud examination and to the fraud examiner’s work.
Unlike a fraud examination report, an expert report should include specific information detailing the fraud examiner’s opinions of a case, as well as the fraud examiner’s qualifications and bases for providing those opinions.
A. True
B. False
A. True
Fraud examiners who serve as expert witnesses in litigation are tasked with providing an expert report, which requires them to provide particular information about their qualifications, their opinions, the bases of those opinions, and various other pieces of information. The purpose of an expert report is to inform the parties, the judge, and the jury (if applicable) about the expert’s opinion of the case, as well as his credibility for commenting on such issues.
A fraud examination report documents the results of a fraud examination and is generally created by one or more critical members of the fraud examination team. Documenting results is a particularly important function in fraud examinations. The fraud examination report conveys all evidence necessary to evaluate the case, and it can be used to corroborate previously known facts. An accurate report will add credibility to the fraud examination and to the fraud examiner’s work.
The fraud examiner should document the details of an interview within a month of the interview date.
A. True
B. False
B. False
Written reports must be timely. The timeliness of reports is extremely important because it tends to enhance the accuracy of witness testimony, as well as preserve the fraud examiner’s memory of the interview(s). Thus, all interviews should be transcribed and documented in a memorandum of interview as soon as possible after the questioning takes place—preferably on the same day of the interview.
When reporting the results of fraud examination matters, the Certified Fraud Examiner (if qualified as an expert on such matters) may issue an opinion on which of the following?
A. The adequacy of the entity’s internal controls
B. Whether the entity’s financial statements conform to generally accepted accounting principles
C. The effectiveness of the entity’s operations
D. All of the above
D. All of the above
Fraud examiners must be cautious about providing conclusions and stating their opinions. Opinions regarding technical matters, however, are permitted if the fraud examiner is qualified as an expert in the matter being considered. For example, a permissible expert opinion might address the relative adequacy of an entity’s internal controls. Another opinion might discuss whether financial statements conform to generally accepted accounting principles. Also, recommended remedial measures to prevent future occurrences of similar frauds are essentially opinions, but are acceptable in fraud examination reports; however, it is better for the fraud examiner to convey recommendations related to flawed internal controls and other organizational failings to management in person or in a separate document. If included in the primary report, this information could potentially be seized upon by defense attorneys at a trial or by representatives at an unemployment hearing to push blame away from the suspect’s actions and toward the organization’s shortcomings.
A(n) _____________ is a type of visual aid, in the form of a grid, that shows the relationship (or points of contacts) between a number of entities.
A. Organization chart
B. Time-flow diagram
C. Matrix
D. Decision chart
C. Matrix
Reporting the results of fraud examinations is often facilitated through the use of visual aids. A matrix is a type of visual aid, in the form of a grid, that shows the relationship (or points of contacts) between a number of entities.
Because the laws of evidence generally protect written fraud examination reports from being disclosed to adverse third parties, fraud examiners can prepare written reports with the understanding that the information will not be disclosed to anyone outside the company.
A. True
B. False
B. False
When drafting a report, fraud examiners must consider who might end up reading it. Fraud examiners should keep in mind that the fraud examination report will be read by the general public and adverse parties. Under no circumstances should the fraud examiner prepare a communication with the idea that the information will not be disclosed to adverse third parties. Fraud examiners should draft their reports with this caveat in mind.
There are many parties that might read a fraud examination report, including:
* Company insiders (managers, board of directors, owners, investors, etc.)
* Attorneys (legal counsel, prosecutors, regulators, and defense counsel)
* Defendants and witnesses
* Media outlets
* Judges or juries
A fraud examiner is planning how he will organize and present information in the report writing stage of a fraud examination. Which of the following statements is most accurate?
A. The fraud examiner should present the information either by transaction or by party.
B. The fraud examiner should only present the information chronologically.
C. The fraud examiner should present the information alphabetically with respect to parties and document titles.
D. The fraud examiner should present the information either by transaction or chronologically.
D. The fraud examiner should present the information either by transaction or chronologically.
Because of the amount of information and the number of documents that might be collected during a fraud examination, it is imperative that the fraud examiner properly organize the information. If circumstances permit, an information database should be established in the early phases of the case. Information can be presented either in chronological order or by transaction when writing the fraud examination report.
In contrast, during the evidence-gathering stage of an investigation, chronologically organizing the documents that will later be used in drafting the report is not recommended because it will make searching for relevant information more difficult. It is generally better to organize documents by transaction or by party while evidence gathering is still occurring.
Paige is going to testify as a witness regarding her team’s fraud examination report for a complex fraud case involving thousands of documents. She delegated much of the document analysis to subordinates at her firm, who wrote summaries of the key documents they found. In preparing for her testimony, Paige only needs to analyze the summaries prepared by her subordinates.
A. True
B. False
B. False
Paige should, wherever practicable, conduct a complete review of supporting documents. One important problem in the preparation of reports and accounting summaries arises from delegation of tasks to subordinates. If the person giving evidence has not had direct knowledge of or has not examined the specific documents or prepared the accounting summaries, it might be possible that the expert will be trapped under the hearsay rule. If tasks are delegated, it is important that the review process entail review of all work to original documentation on a 100-percent basis.
It is also important to know the effect of the other assumptions on the conclusion or opinion reached in the report. It is often possible to trap an expert into giving alternative opinions based upon other assumptions that had not been considered. The work should be planned carefully enough in advance so that the work papers and supporting documentation do not show contradictory conclusions that the opposing side could seize upon.
All written fraud examination reports must include a follow-up/recommendations section.
A. True
B. False
B. False
A follow-up/recommendations section is generally an optional part of a written fraud examination report. This section identifies any aspect of the investigation that remains outstanding, usually because it is outside the mandate of the investigator. This could include the recovery of property that is in the possession of third parties or the collection of information held by vendors or suppliers.
Which of the following would NOT be an acceptable section to include in a written fraud examination report?
A. An executive summary section that gives an overview of what occurred during the investigation
B. A scope section that describes the range of issues reviewed in the examination
C. A findings section that summarizes the facts and findings of the examination
D. A conclusion section that evaluates the guilt or innocence of the suspect(s)
D. A conclusion section that evaluates the guilt or innocence of the suspect(s)
While there are many report forms and each might serve its own purpose, the following sections generally should be included in written fraud examination reports:
* Background: Generally, a written report should contain a background section. The background section should state why the fraud examination was conducted (e.g., an anonymous tip was received, an anomaly was discovered during an audit, money or property was missing).
* Executive summary: A written report should also include an executive summary, which should provide the reader with an overview of what was done during the examination process.
* Scope: Generally, a written report should include a section that identifies the examination’s scope.
* Approach: A written report should include a section about the approach used.
* Findings: A written report should include a section that summarizes the investigation findings.
* Summary: A written report should include a summary of the results of the fraud examination.
* Impact: A written report should also include a section addressing the impact of any misconduct identified during the investigation.
* Follow-up/recommendations: If requested, a written report might include a section for recommendations related to procedures and controls; however, it is better for the fraud examiner to convey recommendations related to flawed internal controls and other organizational failings to management in person or in a separate document.
Opinions or conclusions concerning the guilt or innocence of a fraud suspect is outside the scope of a fraud examination and should never be included in a report.
