You have been assigned to a case to explore for unreported income and possible embezzlement of funds from a small financial service organization.
Another staff member used a public records search and other data from the company to complete a financial profile of the suspect. The data sheet has been given to you for further analysis.
This data sheet profile includes a balance sheet and income and expense data. You are aware that there may be other assets that could not be identified or traced to the suspect. Nonetheless, you will prepare a net worth analysis and discuss several observation and issues.
Use the suspect data to do the following:
1. Use the indirect method to prepare a net worth analysis.
2. Prepare a discussion analysis of the results. Guidelines are as follows:
- Discuss the entire 5-year period of data
- Be substantive. Do not just repeat the numbers on the schedule without further critical analysis.
3. Determine whether results indicate if fraud may be occurring or not. Explain why you believe this.
4. Identify other factors you would need to consider to determine that fraud has occurred.