Evaluating Fraud Risk in a Financial Statement Audit [ARF4]

Full Description

Evaluating Fraud Risk in a Financial Statement Audit (ARF4)

August 25th, 2026 / 8:30 am 12:30 pm

Wedgewood Resort / The Taiga Center
212 Wedgewood Drive
Fairbanks, AK 99701

As emerging technologies such as artificial intelligence become more advanced, and their use proliferates, the threat of complex and technology-driven frauds only increases. The Association of Certified Fraud Examiners says that there is fraud lurking in all businesses, including not-for-profit organizations. It often goes undetected for years, and when uncovered, management and the board may question why an auditor did not identify it. The auditors responsibility in a financial statement audit is to assess risk and perform sufficient procedures to obtain reasonable assurance that the financial statements are free from material misstatement due to fraud or error. However, failure to perform an adequate fraud risk assessment and report deficiencies in internal control, such as a lack of segregation of duties, can leave a firm, and their auditor, vulnerable.

Beginning with a summary and discussion of the 2024 ACFE Report to the Nations (the most recent report), this course will further discuss the audit procedures that should be performed in accordance with AU-C 240 as recently amended, best practices in performing fraud risk assessment procedures, when and how to report control deficiencies noted in an audit, and the most frequent types of fraud found in small to mid-sized entities along with internal controls that could be implemented to help prevent and detect them. Utilizing case studies and comprehensive illustrations, best practices in documentation and risk assessment are discussed and analyzed.

This course does not discuss the exposure draft AICPA SAS related to fraud in financial statement audits. That SAS will be discussed when it is finalized (expected third quarter 2026).

Major Topics:
-The fraud landscape in the United States
-Fraud risk procedures as updated by recently issued standards
-Most likely fraud types found in small to mid-sized entities
-Internal controls to prevent and detect fraud
-What to do when fraud is identified or suspected
-Case studies based on recent frauds
-Cybercrime, artificial intelligence (AI), and emerging technologies utilized in fraud

Learning Objectives:
-Understand the drivers of fraud risk in a financial statement audit
-Conduct procedures required by professional literature to assess the risk of fraud
-Develop discussion points to review with management and those charged with governance
-Identify the main types of fraud that occur in small to mid-sized companies and develop internal controls responsive to those risks
-Evaluate fraud case examples and identify how fraud occurred and how it could have been prevented or detected

Designed For: CPAs in public or private practice with accounting, financial reporting, or attest responsibilities

CPE Credits: 4, Auditing

Level of Knowledge: Basic

Prerequisite: None

Acronym: ARF4

Discussion Leader: Kerry Roberts, CPA