Course

Detecting Accounting Fraud

Faculty
Commerce & Business Administration
Department
Accounting
Course Code
ACCT 3850
Credits
3.00
Semester Length
15
Max Class Size
35
Method(s) Of Instruction
Hybrid
Online
Lecture
Course Designation
Certificate in Global Competency
Industry Designation
None
Typically Offered
To be determined

Overview

Course Description
In this course, students will gain an understanding of the institutional and organizational conditions that lead to fraudulent financial reporting, failure of sound corporate governance practice and finally to share-price collapse in stock markets. Both the causes of these failures and their effects on business communities and society as a whole will be discussed. These issues will be examined through case studies of actual incidents of financial misreporting and stock market fraud that have occurred in a variety of organizations including private and publicly-traded corporations, government, and not-for-profit organizations. Reference will be made to standard ethical theories which will be reviewed. Students are recommended to take PHIL 1122 and BUSN 1320 prior to taking this course.
Course Content

1. Introduction to the ethical, moral and legal problem of fraudulent Financial Reporting.

2. Making ethical decisions in the business world; study of major philosophical frameworks for analyzing ethical dilemmas, as well as the most frequent “false exits”.

3. Improper recording of contingent sales and other unethical organizational behaviours. 

4. Moral and ethical dilemmas facing Accounting professionals invoved in holding books open after end of period, entering in multiple element contracts, recording fictitious revenue, improper Valuation of Revenue, submitting misleading Cash Flow Statements, and other professional unethical conduct including employee and employer conflicts.

5. Improper use of Business Combinations and capitalization of expenses.        

6. Immoral and unethical professional decisions such as those relating to deferral of expenses, failure to record expenses, overstating ending inventory, understating reserves for bad debts, failure to record asset impairments, and off-Balance Sheet arrangements.

7. Inadequate Disclosure in MD&A and related party transactions.

8. Unethical leadership as demonstrated during the Mortgage Crisis. 

9. Signals that may indicate possible fictitious reporting in financial statements.

Learning Activities

In-class lectures and/or on-line

Means of Assessment

Assignments and Case studies  30%

Participation 10%

Mid-term      25%

Final Exam   35%

To pass this course, students must obtain a minimum of 50% on invigilated assessments, with the 50% calculated on a weighted average basis.

Invigilated assessments include, in-class quizzes, in-class tests, midterm exam(s) and the final exam.

Students may conduct research as part of their coursework in this class. Instructors for the course are responsible for ensuring that student research projects comply with College policies on ethical conduct for research involving humans, which can require obtaining Informed Consent from participants and getting the approval of the Douglas College Research Ethics Board prior to conducting the research.

Learning Outcomes
  • Analyze the ethical decision making process adopted by various international organizations, including International Accounting Standards Board
  • Demonstrate an understanding of the most frequent fraudulent business practices and GAAP departures in reporting used to: overstate revenue, understate expenses, in business combinations to overstate earnings, overstate assets and reserves.
  • Identify and analyze use of special purpose entities and round-trip transactions to falsify financial reporting
  • Analyze the importance of institutional and environmental influences, and how they can assist Accounting professionals and other citizens develop the ethical and moral values in their careers and their role as leaders.
Textbook Materials

Detecting Accounting Fraud: Analysis and Ethics. Cecil W. Jackson. Pearson/Prentice Hall

Current copy of the CPA Code of Professional Conduct

And/or other textbook and materials approved by the department

 

Requisites

Prerequisites

ACCT 1210 with a C or better OR ACCT 1235 with a C or better

Corequisites

Courses listed here must be completed either prior to or simultaneously with this course:

  • No corequisite courses

Equivalencies

Courses listed here are equivalent to this course and cannot be taken for further credit:

  • No equivalency courses

Course Guidelines

Course Guidelines for previous years are viewable by selecting the version desired. If you took this course and do not see a listing for the starting semester / year of the course, consider the previous version as the applicable version.

(Current)

Course Transfers

These are for current course guidelines only. For a full list of archived courses please see https://www.bctransferguide.ca

Institution Transfer Details for ACCT 3850
Athabasca University (AU) AU ACCT 2XX (3)
Capilano University (CAPU) CAPU BFIN 3XX (3)
Coast Mountain College (CMTN) No credit
College of the Rockies (COTR) COTR MGMT 2XX (3)
Kwantlen Polytechnic University (KPU) KPU ACCT 4111 (3)
Northern Lights College (NLC) NLC MGMT 2XX (3)
Okanagan College (OC) OC BUAD 367 (3)
Simon Fraser University (SFU) SFU BUS 2XX (3)
University Canada West (UCW) No credit
University of Northern BC (UNBC) UNBC COMM 2XX (3)
University of the Fraser Valley (UFV) UFV BUS 2XX (3)
University of Victoria (UVIC) UVIC COM 3XX (1.5)
Vancouver Community College (VCC) No credit

Course Offerings

Summer 2023