Confirmation fraud (Bank Confirmation Case) Accounting, Finance Essay

Confirmation fraud (Bank Confirmation Case)
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Institution
Confirmation fraud (Bank Confirmation Case)
Auditors consider confirmation procedures when all assertions need to be confirmed equally well. In this case, evidence provided would not guarantee the truth of the information given. Auditors hence have a better chance if they followed all procedures and extend the audit process to third parties. Another instance where the confirmation process should be followed fully is when assessing whether evidence provided reduces audit risks for other related. For instance, the account holders for different reasons known to them might forge bank balances. Following confirmation procedures ensure such fraud is unearth. (Elder, R. J et al 2014)
Electronic confirmation is the best, easy and effective. It, however, comes with its advantages and disadvantages. The advantages include the privacy and secrecy of information. Electronic confirmations provide safe, private links for confidentiality, which it might be tempered within open communications. Firewalls help in blocking any incoming data, which might be suspicious as well as identifying those traffic patterns that might cause harm. These guarantee the safety of information and privacy of the information. (Elder, R. J et al 2014)
Another advantage that comes with electronic confirmation is that it helps in authenticating the participants doing the confirmation activity. With the rise in impersonation and bad motived persons, electronic confirmation helps big time in verifying the confirmation participants. The organization being audited needs to be assured that the auditor carrying the procedures has the permission of the client. The auditor, on the other hand, gets to know that the request for confirmation goes to the right recipient. This is made possible by validating the auditor’s information like the address, business permit, and the phone number. Use of unique login passwords (Sanusi, Z. M et al 2015)
Electronic confirmation also enhances the efficiency of...