Recent accounting scandals such as Enron and Worldcom and new laws such as the Sarbanes-Oxley Act have greatly increased the demand for anti-fraud professionals. Some highlights from the Association of Certified Fraud Examiners’ (ACFE) 2008 Report to the Nation on Occupational Fraud & Abuse clearly demonstrates the need for accounting students to receive instruction on this important topic: U.S. Organizations lose approximately 7% of their annual revenues to fraud (almost one trillion dollars per year). Occupational fraud schemes tend to be extremely costly and continue for years before they are detected.

The implementation of anti-fraud controls appears to have a measurable impact on an organization’s exposure to fraud. Lack of adequate internal controls was most commonly cited as the factor that allowed fraud to occur.

The seriousness of the problem and the need for accounting students to learn about fraud, including its prevention and detection, is demonstrated by the July 2008 issuance of Managing the Business Risk of Fraud: A Practical Guide. The Institute of Internal Auditors, the American Institute of Certified Public Accountants, and the ACFE sponsored this “guide”.

This article is from the Accounting Instructors’ Report, an electronic journal that provides teaching tips and insights to those who teach accounting and other business courses.


Neal R. VanZante, The University of Texas Pan American

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