Replies (8)
Please login or register to join the discussion.
VAT Avoidance?
'The most common types of fraud included mortgage fraud, under reporting of revenue and VAT avoidance. '
So that's it - VAT avoidance is fraud! Presumably that applies to all other tax avoidance.
All good in theory but impossible in practice
People talk about small firms, but have no touch with the real issues facing small firms. Small businesses will not pay for professional advice and work and no matter how strict the law becomes, accountants can only work using the money that is availible to them.
We look at VAT fraud and under reporting of revenue and mortgage fraud.
In my practice i do as much as is possible to show a true and fair profit in the accounts. However would any person work an extra 10 hours for no pay! It should be government departments that bear the costs and that is by employing more inspectors to investigate profits submitted which this would set a deterrent to rouge busineses and individual. It would also justify accountants increasing fees to undertake such risk profiling work.
Secondly, the banks should do more to investigate mortgage borrowings rather than simply sending out a standard, unhelpful and waste of time reference letter to accountants. Maybe banks need to legally engage with the accountant and pay the accountant to do work on their behalf! Now that will never happen with small firm accountants.
Finally, it isn't the small firm accountants that collapsed the banking system and de-regulated the financial sector. Maybe this con-dem government should look at the real issues and not skirt around them.
Nice one Chesterfield!
...so on top of SOCA, we've got yet another QUANGO touting for our business. For free, of course.
Interesting perspective and some sound advice and some thoughts
The article provides some interesting insights on fraud trends and excellent advice regarding checks on potential employees. However I am not sure whether it is suggesting that fraud hasn't increased but that there is a higher detection rate due to there being more whistleblowing.
Instinctively I would have thought that difficult times lead to greater personal financial pressures and more streamlining of accounts departments. Therefore the is likely to be greater opportunity and motivation for fraud.
I have long taken the view that clients expectations of accountants extend beyond the letter of the engagement letter. The view amongst many accountants is likely to be the responsibility for prevention and detection of fraud rests with the client.
The reality is that many SMEs do not have the skills in house and by default would expect their accountants to provide support. Furthermore many SMEs by their nature cannot have a strong segregation of duties (which helps prevent fraud) and where management are not financially savvy the risk of fraud increases.
I believe that many businesses take the view that fraud is not going to happen to them and perceive anti fraud measures as a cost with little added value. (If it does happen they shut the door after the horse has bolted.)
Last year I wrote an article which appeared on AccountingWeb setting out anti fraud measures that SMEs can adopt. It includes implementing good day to day financial management practices, which add real value to the business and as a byproduct reduce the risk of fraud. Here is a link to the article, I hope it is of interest.
I think one question that accountants need to consider is when clients don't have good in house financial management skills will the support and advice they offer be sufficient for the client's needs, or is extra resource (that can cost effectively devote more time) required?
David Lewis
Fraud Prevention
I have been involved in Fraud Prevention for 25 years. Headed up the West African Organised Crime Group in the UK as well as dealing with crimes of fraud, local, National and International..
The issues are simple, most people are blind to the subject. If they too a little more care, had some education in their roles and duties the fraud problem can be greatly reduced.
Who ever reads this can the go to www.amarlis.com and go throught the fraud questionnaire, this will give you an idea of how good or bad youre knowledge is about fraud prevention.
Like feed back.
Come on you guys this epidemic cna be sorted with little or no pain. When the pain would be for the bad guys
Tom Craig
Leading ground floor authority in Fraud related issues, Identity Theft and document abuse.
Fraud
The higher technology becomes the higher the fraud. So these figures do not surprise and they will increase.
I don't think that when these articles are written notice is taken of a highly successful industry born out of lack of control from the top.
Accountants and tax payers are forced into giving away loads of private information to all sorts of "bodies".
If you mean underdeclaring income is a painter not declaring £500 cash for a "private" weekend job, what possible safeguards can stop that.
If the government lose extremely sensitive information on tax payers, is that our fault? and should we have to fork out for their neglect.
Then there is the extremely clever "hacker". If they can get into top US computers what chance have we got of stopping them.
The bottom line is we could spend thousands on safeguards and still not keep up with these people.
Fraud
There is free useful advice specifically aimed at SMEs on the Fraud Advisory Panel website http://bit.ly/dcfhFs