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RECENT CONTENTS
 Archival CD (Volumes I-V) now available ($519)
VOLUME I NUMBER 1 (June 2000)
VOLUME I NUMBER 2 (December 2000)
VOLUME II NUMBER 1 (June 2001)
VOLUME II NUMBER 2 (December 2001) ARTICLES  Time Value and the Expert Witness: Guidance from the Tobacco LitigationM. Coller and G.W. Harrison Adjustments for time value are increasingly becoming relevant in legal settings and are often essential to provide the injured party with just compensation. An Examination of the Association Between S&L Financial Distress and Independent Auditors' OpinionsZ. Rezaee and S.J. Roohani Results suggest that the use of more professional skepticism and "forensic-type" fieldwork by auditors could have provided early signals of S&L financial distress. Forensic Accounting: Older Than You ThinkD.L. Crumbley The roots of forensic accounting can be traced as far back as to an 1817 court decision. This article reviews the history of forensic accounting and traces the development of the aspect of litigation support. Includes numerous expert witness checklists. Conducting a Pro-Active Fraud Audit: A Case Study
C.C. Albrecht, W.S. Albrecht, and J.G. Dunn A significant contribution presenting empirical evidence of the successful application of using a fraud hypotheses testing approach to detect fraud. An Empirical Investigation of the Effectiveness of Balance and Invoice Confirmations
R.D. Allen and R.J. Endler Provides a basis for recommendations that may improve the effectiveness of accounts receivable confirmations, thereby reducing the likelihood of error and fraud. The Effects of Peer Influence on Taxpayer's Compliance Decisions
J.J. Maroney and T.J. Rupert Examines the effects of peer influence and explores potential explanations. The Dispersion in Analysis Earnings Forecasts and the Relative Importance of Earnings and Book Value in Equity Valuation
J.A. Ou and J.F. Sepe Helpful insight to consider when called upon to value equities. COLUMNS & CURRENT COMMUNICATIONS T. Louwers R.E. Flinn Z. Rezaee Forensic Risk Management: Potential Liability Exposure of Third-Party Investigations Under the Fair Credit Reporting Act
C. Pacini, D. Sinason, and W. Hillison G.S. Smith R. Mattessich VOLUME III NUMBER 1 (June 2002) ARTICLES Interviewing as a 'Forensic-type' ProcedureT. Buckhoff and J. Hansen Effective interviewing is a function of both a well-prepared interviewer and a well-structured interview. Survey Evidence Regarding CPA Firms' Forensic Accounting ServicesM. Watters, K.M. Casey and D. Flaherty Survey evidence regarding the frequency of provision of forensic accounting as a client service offered by small, medium, and large-sized CPA firms. Company Size, Auditor Type, and Earnings ManagementB.B. Lee and B. Choi Small companies tend to more frequently manage earnings to avoid losses than do large companies. Income Manipulation and Accounting for Loan Loss ReservesW.B. Joyce The loan loss expense at banks is at least partially managed, or manipulated, in order for bank executives to maximize total monetary compensation. Fraudulent Audited Annual Financial Statements in Post-PSLRA Private Securities Actions: Determinants of Auditor Litigation S. Freund, R.D. Fuerman and L. Shaw Investigates financial disclosure-related private securities class actions where auditors are named as defendants. The Effects of Forensic Accounting Education on an Accountant's Employment PotentialP.H. Mounce and J.J. Frazier The completion of a forensic accounting course does have a positive effect on the employment success of a candidate applying for the position of assistant controller. COLUMNS & CURRENT COMMUNICATIONS T. Louwers R.E. Flinn Fraud Specific AuditingH.R. Davia Abuse, The Road to FraudD.G. Kyle Stock Option Accounting Can Be Materially MisleadingD.L. Crumbley and N.G. Apostolou Financial Status AuditsR.R. Hiner and D.P. Smith Forensic Risk Management: Beware of Bribes of Foreign OfficialsC. Pacini, H. Rogers and J. Swingen Black Tech Forensics: Steganography and its Derivatives - Steganalysis and ChaffingsG.S. Smith M.G. Kaplan VOLUME III NUMBER 2 (December 2002) ARTICLES Implicit Claim Incentives on the Accounting Choices of Troubled CompaniesD. Peltier-Rivest Managers of troubled manufacturing firms (hoghly dependent upon suppliers) have incentives to adopt income-increasing accrual accounting choices to increase the firm's reputation for honoring implicit claims with suppliers and, therefore, maximize the negotiated terms of trade. Discretionary Accounting Accruals: A Methodological Issue in Earnings Management ResearchS. Mitra and J. Rodrigue The authors propose a simple yet elegant accrual determination model that improves upon the weakness of traditional accrual models. Forensic Accounting Practices, Education, and CertificationsZ. Rezaee Examines the relevance and importance of forensic accounting and fraud examination practices, education, and certifications. The "Pump and Dump" and "Cybersmear:" An Investigation of Two Cases of Internet-based Stock Price ManipulationA.J. Cataldo and L.N. Killough Theory and recent research predict, and findings suggest, that firms are more likely to intervene only in cases where information takes the form of bad news or cybersmear. The Perceived Occurrence and Acceptance of Dysfunctional Audit BehaviorD.P. Donnelly, D. O'Bryan, and J.J. Quinn Recent audit failures and criticisms of the auditing profession may not be attributable to the micro-level behaviors examined in this study but rather to macro-level issues such as the underlying audit approach, the overall design of audit programs, the regulatory structure of the audit process, and the interaction between auditing and consulting. Damages Measurement of New Economy FirmsW.G. Bremser As economies move toward an e-business environment, there are new challenges to forensic accountants in business valuations and damage computations. COLUMNS & CURRENT COMMUNICATIONS Daubert - The Evolution of a ProfessionM. Shirley A Forensic Accountant Follows the Money Trail of Edwin EdwardsL. East M. Salzman T. Louwers R.E. Flinn Forensic Risk Management: The Forensic Accountant's Role in Fighting Terrorist FinancingC. Pacini Black Tech Forensics: When is a Cybercrime Really a Cybercrime?G.S. Smith VOLUME IV NUMBER 1 (June 2003) ARTICLES SAS No. 99: A New Look at Auditor Detection of FraudM.S. Beasley Highlights of SAS No. 99 provisions, with an overview of the reasoning behind them. The Impact of SAS No. 82 on Auditor's Tolerance of Earnings ManagementT.E. Vermeer After controlling for effects on discretionary accruals, this study suggests SAS No. 82 did not decrease auditor tolerance of managed earnings, and questions whether the process which evolved SAS No. 99 does not continue this deficiency. Aspects of a Management Control Philosophy that Contribute to Fraudulent Financial ReportingP. Dunn Auditors should be sensitive to the firm's management control philosophy as well as its control structures. Stealth Earnings Management: Counting the Same Beans Twice?J.L Turner and C. Wheatley Results indicate that stealth earnings management may be useful in helping managers to achieve perceived objectives in that minimal disclosures of recounted earnings are typically overlooked by securities markets. Government Compliance Initiatives in Combating Fraud and Abuse in Federal Health Care ProgramsD.B. Pariser and R.C. Brooks An overview of common health care frauds, federal health care anti-fraud legislation, elements of a voluntary compliance program and corporate integrity agreements. Application of Digital Analysis to Assess the Quality and Usability of the ATA DatabaseP. Caster, B. Mittag, and C.A. Scheraga This study extends the use of digital analysis techniques to examine self-reported data in a database where quality and usability have been questioned. Viatical Fraud: What the Accountant Should KnowN.J. Gierlasinski and K. Carnes A comprehensive overview of viatical fraud that pinpoints innocent investors, insurance companies, and certain insureds as potential victims and highlights procedural steps helpful in identfying and preventing such schemes. Accountants as Expert Witnesses: A Primer on Meeting Daubert ChallengesB.K. Peterson and D.R. Barnhill Guidance on how to surmount Daubert challenges when engaged to testify as an expert witness at trial. COLUMNS & CURRENT COMMUNICATIONS Financial Statement InsuranceJ. Ronen Cooking the Books is a Crime: A Lesson Learned From the Enron CaseZ. Rezaee Immunity from Civil Liability for the Expert Witness: Don't Count On ItD.L. Crumbley and W.E. Seago Your Forensic BookshelfT. Louwers R.E. Flinn Forensic Risk Management: The Forensic Accountant and ForgeryC. Pacini Black Tech Forensics: Investigating Money LaunderingG.S. Smith VOLUME IV NUMBER 2 (December 2003) ARTICLES A Neural Network Approach to Predicting Corporate Illegal BehaviorS. Ragothaman Results suggest that the non-linear neural network model predicts illegal corporate behavior significantly better than the MDA and Logit statistical models. Auditors’ Beliefs about the Fraud Detection Effectiveness of Standard Audit ProceduresG.D. Moyes and C.R. Baker Results indicate that fraud detection would likely be improved if the identified standard audit procedures were strategically selected for use early in the audit examination. The Relation of Information Technology and Financial Statement FraudM.S. Beasley and J.G. Jenkins An examination of the two-sided relation between information technology and financial statement fraud: IT related weaknesses and IT enhanced audit techniques. The Role of Bargaining Style in Public Company AuditsH.M. Hermanson, K.S. Schulzke and G.R. Shell A groundbreaking study that includes suggestions to improve audit effectiveness by crafting particular negotiation strategies to address circumstances of audit conflict. Managers’ Incentives to Manipulate Earnings in Management Buyout Contests: An Examination of how Corporate Governance and Market Mechanisms Mitigate Earnings ManagementJ. Begley, T.V. Eaton and S.W. Peck Research indicates that corporate governance mechanisms are more effective than market mechanisms in discouraging pre-MBO earnings management. Have New Economy Firms Ushered in a New Era of Earnings Management?L.N. Bitner and J.M. Trussel Presents a predictive model that indicates internet based firms have a greater probability of earnings management. Assessing the Financial Health of Governmental UnitsN. Apostolou and D.L. Crumbley A review of financial indicators that can be useful in evaluating the financial condition and performance of governmental units. COLUMNS & CURRENT COMMUNICATIONS Business Identity Theft: The Latest TwistJ.M. Collins Pro-Active Fraud Auditing: Technology, Fraud Auditing, and LiquorJ.T. Loftus and T.E. Vermeer Problems Solved with Forensic Accounting: A Legal PerspectiveD.W. Squires The Role of the Forensic Accountant in a Criminal InvestigationL.J. East Your Forensic BookshelfS. Mitra Forensic NewsR.E. Flinn Forensic Risk Management: Privileged Communications Between Forensic Accountants, Attorneys, and Clients Threatened by Federal RuleC. Pacini Black Tech Forensics: War Driving - Who is Accessing Your Confidential Data Files?G.S. Smith Some Gratuitous Inflammatory Remarks on the Accounting IndustryS. Savage VOLUME V NUMBER 1 (June 2004) ARTICLES Forensic Accounting Techniques: A Defensible Investigatory Process for Litigation PurposesB. Waldrup, K. Capriotti and S.C. Anderson A proven methodology to clean and prepare data for litigation purposes. The Effective Use of Benford's Law to Assist in Detecting Fraud in Accounting DataC. Durtschi, W. Hillison and C. Pacini The authors review the background and development of Benford's Law, and then show where digital analysis based on Benford's Law can be used most effectively and where auditors should exercise caution. Audit Technique Guides from the IRS: Useful Tools for Industry Specific InvestigationsE.D. Fenton, Jr. The ATGs developed and published by the IRS are excellent resources to quickly learn auditing approaches to industry specific business processes. An Analysis of Auditors' Fraud Risk Judgments in a Multi-Audit Task SettingF. Choo and K. Tan An examination of auditor fraud risk judgments in multi-audit task settings that provides relevant post SAS No. 99 recommendations related to auditor knowledge and experience, procedural tasks, and decision aids. Earnings Management by Initial Public Offering Firms: A ReexaminationS.B. Jackson A study which challenges the claim that firms opportunistically manage pre-IPO discretionary accruals, and suggests that post-IPO declines in earnings performance may instead be related to management of post-IPO discretionary accruals. Towards an Economic Theory of Management Fraud and Corporate FailureP. Barnes This historical review of managerial discretion and diversion indicates corporate collapses were to be expected, and that cycles of success and failure offer important predictive value. Fraud and Corporate Executives: Agency, Stewardship and Broken TrustW.S. Albrecht, C.C. Albrecht and C.O. Albrecht An exploration of the relationship between theories of management, organizational structure, and recent financial statement frauds; including a proposed organizational model that may be useful in predicting and preventing fraudulent behavior by management. Lessons for Auditors: Quantitative and Qualitative Red FlagsH. Grove and T. Cook Using a number of high profile cases, this study examines the efficacy of traditional vertical, horizontal, and ratio analyses in fraud detection, and identifies a number of new quantitative and qualitative analytics that promise useful predictive value. Financial Ratios and Fraud: An Exploratory Study Using Chaos TheoryK.A. Kaminski and T.S. Wetzel By using financial statement data from both fraudulent and non-fraudulent firms to longitudinally compute ten financial ratios, this study finds that none of the tested ratios exhibited stable or periodic behavior, and that use of financial ratios based on balance sheet data is an inappropriate tool to detect fraudulent firms. Student Case: Pork to Plate Corp.J.P. Osborn This case, designed for classroom dissemination, offers insight into forensic accounting by challenging students to reconstruct a more accurate amount of net income while facing an unreliable accounting system with "inadequate, nonexistent, or possibly falsified books." COLUMNS & CURRENT COMMUNICATIONS Audit Committees: The Last Best HopeLetter from the Publisher Forensic Business ValuationC. Hamilton Earnings Management and Vendor AllowancesM.F. Massoud A Forensic Accountant as an Expert Witness in a Criminal ProsecutionM.H. Sanchez and J. Trewin Special Masters and Court Appointed ExpertsW.A. LaGraize, Jr. and D.L. Crumbley Your Forensic Bookshelf
Edited by Santanu Mitra Forensic NewsEdited by Ronald E. Flinn Forensic Risk Management: Beware of Charitable Donations Supporting TerrorismC. Pacini Black Tech Forensics: Divergent Views and Approaches Toward the Digital Evidence of Financial FraudG.S. Smith J.J. Leisenring VOLUME V NUMBER 2 (December 2004) ARTICLES
Quality Financial Reporting and its Relationship to Audit Quality via an Expanded Risk Model
W. Smieliauskas and K.C.K. Lam Integrating principles of quality financial reporting with evidence-based principles of quality auditing, the authors propose a fundamental alteration in the nature of auditor reasoning which requires significantly increased attention to the appropriate evaluation of the accounting facts (evidence). An important aspect of the framework is that it facilitates the detection of deceptive reporting.
An Assessment of Auditor Independence: Accounting and Auditing Enforcement Releases and Earnings Management
J. Legoria and J.A. Pendley Testing whether an economic interpretation of auditor independence is correlated with instances of earnings management, the results of this research lend credibility to regulators' arguments that auditors could take a more proactive stance on clients' management of earnings and, thus, actively improve the quality of earnings reported to the investing public.
Capital Market Reactions to Auditor's Reputation: Evidence from Andersen's Former Clients
Z. Rezaee, A.K. Hunt and J.M. Lukawitz Investigating whether companies audited by Andersen exhibited abnormal returns during the time period surrounding Andersen's demise, the results suggest that auditor reputation can have a significant impact on the credibility of clients' financial statements, and that the auditor's reputation is more damaged by actions of the accounting firm rather than by problems of specific audit clients.
A Comparison of Accounting Majors' and Forensic Experts' Classification of Management Fraud Risk Factors
J.D. Hansen and B.K. Klamm Student ability to recognize management fraud risk factors is measured, and results suggest that they are developing professional judgment which aligns with the management fraud risk factor classifications of experts within the current SAS 99 framework.
Why is Management Reticent to Report Fraud? An Exploratory Study in the UK
A. Higson Utilizing a semi-structured interview technique with senior auditors and forensic accountants in the UK, this study examines management motivation and inclination to report fraud. Identified issues include vagueness of director responsibilities, confusion as to the benefits of such reporting, and difficulties with the imprecision of the umbrella term "fraud."
Management's Emphasis on Integrity and Ethical Values: A Function of an Organization's Size and Ownership Type?
J.M. D'Aquila Based on an extensive survey, this research explores managerial perceptions of organizational emphasis on integrity and ethical values; and suggests a strong correlation with both organization size and ownership type.
Civil Court Procedures and Their Relevance to Expert Witnesses
N. Angellotti and D.L. Crumbley By comparing and contrasting relevant procedural rules in Canada, the United States, Australia, and the United Kingdom, this article explores issues related to jurisprudential motivation, independence and objectivity, admissibility and reliability, and communication and cooperation. Proactive expert witnessing guidelines for forensic accountants are distilled.
Earnings Management in Targeted Hostile Takeover Firms
L. Guan, C.J. Wright and L. Sun To test the notion that managers who engage in earnings management seek to maximize their personal gain, this study investigates the discretionary accounting accruals made by hostile takeover targets one year prior to the initial tender offer; and suggests a conflict between managerial self-interest and the goals of the stockholders.
Student Case: TruGloss Shanghai JV
B. Ballou, J. Mueller and P. Zikmund This class-tested Student Case challenges students to assess cultural, operating, and internal control conditions which may indicate specific fraud vulnerabilities. Analysis of the fictionalized business scenario provides an opportunity to develop evidence gathering and interviewing strategies. COLUMNS & CURRENT COMMUNICATIONS
Reconstructing Business Income in Financial Litigation
R.M. Wise
Comments on the Forensic Services Discussion Memorandum: An Open Letter to the AICPA
J.E. Ketz
Investigative and Forensic Accounting: An Accredited Specialization of Public Accounting
R. Labelle
Tax Fraud Abusive Trust Schemes and IRS Efforts to Put a Stop to Them
K.B. Friske and D. Pulliam L. Blair
Successes and Failures with a New Fraud Course at a Small University
T.W. DeBerry
Fraud Prevention - What Are We Waiting For?
W.A. Hanlin, Jr.
Conflict and Crime in Business Life: Keeping Yourself and Others Safe
C.E. Sullivan
Forensic Accounting: It's Positively Ancient
P. McClelland and P. Stanton
Check 21: Fraud Implications of the Check Clearing for the 21st Century Act
C. Pacini
Your Forensic Bookshelf
S. Mitra R.E. Flinn
Rational Cheating: Everybody's Doing It
D. Callahan
Author/Title Index of Papers: Volume I (2000) through Volume V (2004)
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