Missing Supporting Document

Just read the CFE (Certified Fraud Examiner) Magazine.

Missing sup doc is a red flag. When we take sampling and found that some transactions are not supported with documents, we cannot forget it and drive on (FIDO). We have to question why the sup doc is not available.

Common reasons answered why the sup doc is not there:

• It was approved by director’/owner directly.
• It was director/owner’s personal expense.
• It was kept by accounting personnel who have resigned.
• It was moved by someone else whom we don’t know.
• The filing is messy and scattered. Maybe it is kept somewhere else.
• We forget where we put it.

The substitution of sampling with other transactions with similar account  but have sup. doc should be questioned with professional skeptiscm.