The FBI for committing massive financial statement fraud arrested the officersof an oil refiner, trader, and hedger based in New York. The executives usedmany schemes to perpetuate the fraud, one of which was to hide a $30 millionaccounts payable from the auditors and show it as a payable arising in thefollowing year. To conceal the fraud, they altered purchasing records, usingcorrection fluid, and provided only photocopies of the records to the auditors.The Big 4 firm that audited this company was later sued for audit negligencein not finding this fraud.In your opinion, were the auditors negligent for accepting photocopiesof purchasing records and not detecting this accounts payableunderstatement?My opinion is:Yes the Big 4 firm was negligent because…5-Paragraph essay.At least 4 sentences per paragraph.The main idea for the three body paragraphs:Not providing original documentation when original documentation should exist is anaccounting/documentary warning sign of fraudSuch a large amount of money that would significantly impact the financial results ofthe company appears as a payable for next year, when a payable this year wouldhurt the financial statementBecause of the documentary indication, did the Big 4 firm auditors try to find outinformation about the officers including their personal financial information to detectany significant lifestyle changes
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