Understated assets

Overstated liabilities

Overstated revenues

Understated equity

A vendor rewards a purchasing employee with tickets for a professional sports team’s game after the employee directs business to the vendor.

An employee receives a payment for directing excess business to a vendor.

A purchasing employee and vendor agree to bill the company for services never rendered.

A politician threatens to shut down a business if it does not pay a bribe.

The misstatement or omission of financial information for the purpose of personal gain

The intentional or accidental misstatement of amounts in the financial statements

The intentional understatement of assets or overstatement of liabilities on the balance sheet

The deliberate misrepresentation of a company’s financial condition

Gross profit is equal to revenues less operating expenses.

Net profit is the difference between total sales and the cost of goods sold.

A company’s cash balance is usually the first line item listed.

Gross revenue is the total amount of sales before deductions are applied.

Mobile deposits are at high risk for new account fraud because face-to-face transactions are not required.

Automated teller machines (ATMs) are rarely targets of new account fraud because most have cameras installed.

Fraud is more likely to occur in established accounts than in accounts that have been newly opened.

New account fraud can be defined as any fraud that occurs on an account within the first year that it is open.