Rita Crundwell Fraud Case Study
For Case Study #2, you will continue to work with the Rita Crundwell case.
You have been hired by the City of Dixon to investigate certain allegations relating to Rita Crundwell. Using the information you gathered in Case Study #1 (prior order #81671081; attached) and your analysis of the audited financial statements for the City of Dixon April 30, 2011 (attached), write a report of investigation summarizing the evidence and estimating the fraud loss suffered as a result of the fraud scheme.
Your report of investigation should include the following elements:
Identify your client
Purpose
Background
Scope
Work Performed and observations
Conclusions based on work performed
The report should also include specific recommendations for preventing this type of fraud in the future. Please use Chapter 18 in your textbook (attached) as a guide to writing this report.
When analyzing the audited financial statements, you need to understand the definitions of the funds—how the funds should have been sourced and what expenses the funds could pay. Once you understand the definitions of the funds, you should then be able to identify the exceptions and red flags based on the actual flow of money among the funds. As with all financial investigations, follow the cash. Please see the City of Dixon audited financial statements (attached).
This report is not a research paper. You will not write the report using an APA format. You will need to write the report using the guidelines presented in in Chapter 18. As mentioned in the Chapter, the AICPA and ACFE have developed standards for report writing.
Your report should clearly layout the case, including background, red flags, findings, conclusion and suggested internal control improvements.
For your investigative report, you will not reference technical material used like you would for an APA research paper. Most of the time, you will make references to the documents used in the body of the report. For example, you would reference the documents you reviewed in the Work Performed section of the report. Also, when you discuss your findings, you would list the documents reviewed. With respect to the technical journals, textbooks, etc. you would not specifically reference them unless they are relevant to the point you are making in your report. You do not have to extrapolate to get to the total loss of the fraud. You can use the loss amount reported in the news for the entire period of the fraud. You can take some creative license here since you have not conducted a complete investigation, extending back to the 1990s.
For example, if I were hired to look into the alleged wrongdoing by Rita, I would review a period of time for red flags. Once I identified the likelihood of fraud, I would expand the period reviewed. Once I reviewed all relevant data, I could estimate an amount that was potentially misappropriated based on the facts of the case. So for this assignment, you can state that you estimate the loss to be $$$$ over the period reviewed.
