How CFEs and internal auditors work together to prevent and detect fraud

CFEs and Internal auditors work together to prevent and detect fraud

CFEs focus on identifying fraud schemes, methods of conducting investigations into them as well as elements making up their illegality. The training given to CFEs enables them conduct comprehensive investigations, gather evidence needed for prosecution purposes and appear before courts when required. Their aim is primarily concerned with exposing possible fraudulent activities inside a firm and consequently addressing associated risks in relation to its operations.Read more.

Internal auditors provide independent assurance on an organizations operations including risk management processes, control processes and corporate governance arrangements. They conduct thorough investigations, gather evidence, and testify legal proceedings if required.

The CFE plays an important role in internal auditing by providing specialised expertise for detecting and preventing fraud. These skills, together with technical knowledge and best practices, help to improve the overall proficiency of experts in this field.

Collaboration between CFEs and Internal Auditors

Risk Assessment:

Internal Auditors appraise the firm’s general risk climate comprising fraud risk. They single out regions with elevated fraud risks and accord them higher priority for deeper examination.

On the other hand, specialized fraud risk assessment by CFEs aids in identifying specific company-related fraudulent schemes that might be prevalent.

Internal Controls Evaluation:

When reviewing internal controls, internal auditors focus on their structure and efficiency. They also guarantee that countermeasures employed are adequate to minimize hazards identified for example those linked to fraud.

In addition, CFE’s help to develop anti-fraud policies and systems such that they will have built in mechanisms for detection or prevention of frauds which are strong enough.

Fraud Detection:

By utilizing various methods of auditing, Internal auditors can detect suspicious signs and deviations that may hint at illegal activities. They do periodical audits as well as surprise checks so as to bring into light any possible concerns.

However, CFEs perform an extensive enquiry into suspected cases of fraud. The forensic accounting method is used by them for interviewing suspects/witnesses while gathering evidence confirming the occurrence of the crime.

Training and Awareness:

The development of the culture of honesty and ethical behavior in a company is supported by Internal Auditors. They deliver internal controls, compliance and fraud awareness trainings.

CFEs offer specialized training for the detection and prevention of embezzlement cases such that employees will be able to recognize signs of impending danger as well as value reporting all the suspicious activities.

Reporting and Communication:

CFEs coordinate with internal auditors so that they can go through every aspect that relates to fraud that occurs within an organization. Moreover, they can communicate directly if situation warrants with legal authorities in addition to law enforcement agencies.

Netrika helps anti-fraud efforts through CFE certificate training, offering specialised courses with industry experience. Our CFE certificate course, developed in partnership with ACFE India, allows learners to get professional recognition and reputation while also increasing their global marketability and job security.