Economic crime and fraud continually make headline news. People tend to be resorting to economic crime and fraud in order to cushion the effects of the economic global crisis. A lot of managers have lost hope as most of these frauds and economic crimes are committed and perpetrated by insiders. This then presupposes that economic crime and frauds can effectively be curbed by an insider.
No other information processing professional is better positioned to wedge war against economic crime perpetrators than accountants. This is evidenced by the responses that accountants and their professional bodies gave to the new challenges brought to them by changes in the modern day business landscape. Or tell me how you can effectively fight economic crime and fraud when you do not have good finance background.
The best way to prevent economic crime and fraud is to have a good internal control in place. It is better to anticipate problem and put measures in place to control it than to react to problems. Accountants acts in various capacities in establishing a good functional and operational internal control. Some of which are discussed in this article.
Accountants can act as: Auditors, Consultants, Business Advisors and Accounting Information System (AIS) designers to businesses and these various roles gives accountants opportunities at different levels to positively impact a business in such a way that quality internal controls are maintained.
ACCOUNTANTS AS AUDITORS
The traditional duty of an auditor was to lend credibility to a piece of information. Auditors in this our modern day now have it as part of their responsibilities to actually look out for fraud and economic crime. That is why many professional accounting bodies now encourage their members to also become members of fraud fighter professionals like ACFE as this will help them fill the gap created in their training as accountants and auditors. Also taking up one or two computer forensic courses is a recommended step that auditors should take in order to effectively play their role in the fight against economic crime and fraud are now rooted to computer and internet.
ACCOUNTANTS AS CONSULTANTS
Many accountants are now taking up consulting assignments in their various capacity as this will help serve their clients in the manner they are suppose to serve them. Accountants can help prevent tax fraud from taking place and help uncover those that has already taken place. Since accountants are one of the professionals that are closer to business processes, bringing them in as consultants will instill more fear in current and potential perpetrators of fraud and this singular act will go a long way in preventing economic crime and fraud. The mere presence of an accountant as a consultant can make a fraudster nervous enough to point of loosing control and do one or two things that will get him/her implicated.
ACCOUNTANTS AS BUSINESS ADVISORS
The primary duty of business advisors is to advice management on the best possible measure or policies that needs to be in place in order for the objectives of the business to be achieved. This coincidentally happens to be the reason for having an internal control in place. This then means that accountants acting as business advisors help companies set up both functional and operational internal control to help businesses achieve their objectives. Some people will tell you that accountants acting in the capacity of business advisors help businesses carryout business analysis. Their argument is in line as business analysis is the process of assessing and evaluating a company’s risks and prospects and this includes analyzing a company’s business environment, its strategies and its financial position and performance. In short, accountants help prevent fraud and economic crime by carrying out an insightful business analysis.
Accountants as Accounting Information System (AIS) designers
The advent of AIS changed the traditional roles of accountants as records keepers to information specialists. You know that perpetrators of economic crime and frauds look for loopholes in information systems so as to plan and launch their attack. Accountants/ auditors as internal control experts are not likely to leave many loopholes for perpetrators of financial crime and fraud to strike from. Note however that AIS is just a subsystem in the over all information system, but, a properly designed AIS will go a long way in preventing fraud and economic crimes. This is due to the fact that accounting and financial system are where the money is.
The role of accountants in the fight against economic crime and fraud are so important that they can no longer be neglected. Accountants need to wake up and face the challenges that face them as regards the fight against economic crime and fraud.