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A Study on Occupational Fraud within Small Businesses

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The main goal of this study was to understand the awareness of small business owners regarding occupational fraud, meaning fraud committed from within an organization. A survey/questionnaire was used to gather insight into the knowledge and perceptions of small business

The main goal of this study was to understand the awareness of small business owners regarding occupational fraud, meaning fraud committed from within an organization. A survey/questionnaire was used to gather insight into the knowledge and perceptions of small business owners, while also obtaining information about the history of fraud and the internal controls within their business. Twenty-four owners of businesses with less than 100 employees participated in the study. The results suggest that small business owners overestimate their knowledge regarding internal controls and occupational fraud, while also underestimating the risk of fraud within their own business. In fact, 92% of participants were not at all familiar with the popular Internal Control \u2014 Integrated Framework published by the Committee of Sponsoring Organizations of the Treadway Commission. The results also show that small business owners tend to overestimate the protection provided by their currently implemented controls in regard to their risk of fraud. Overall, through continued knowledge of internal controls and occupational fraud, business owners can better protect their businesses from the risk of occupational fraud by increasing their awareness of fraud.

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Date Created
2014-05

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Internal Controls at a Startup Yoga Studio: No Flexible Matter

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Within this paper I summarize the key features, and results, of research conducted to support the development, design, and implementation of an internal control system at a startup small business. These efforts were conducted for an Honors Thesis/Creative Project for

Within this paper I summarize the key features, and results, of research conducted to support the development, design, and implementation of an internal control system at a startup small business. These efforts were conducted for an Honors Thesis/Creative Project for Barrett, the Honors College at Arizona State University. The research revolved around deciding which financial policies, procedures, and safeguards could be useful in creating an internal control system for small businesses. In addition to academic research, I developed an “Internal Control Questionnaire” for use as a ‘jumping off point’ in conversations about a business’ existing accounting system. This questionnaire is applicable across many industries, covering the major topics which every small business/startup should consider.

The questionnaire was then used in conjunction with two interviews of small business owners. The interviews covered both the overall financial status of their business and their business’ pre-existing accounting system. The feedback received during these interviews was subsequently used to provide the business owners with eleven recommendations ranging from the implementation of new policies to verification of existing internal controls.

Finally, I summarize my findings, both academic and real-world, conveying that many small business owners do not implement formal internal control systems. I also discuss why the business owners, in this specific circumstance, did not yet implement the aforementioned eleven suggestions.

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Date Created
2019-05

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Exchange Rate Risk and Relative Performance Evaluation

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The relative performance evaluation (RPE) hypothesis holds that executive compensation should not depend on uncontrollable exogenous shocks. Nevertheless, prior studies often find limited empirical support for this hypothesis in part because it is difficult to identify peers exposed to the

The relative performance evaluation (RPE) hypothesis holds that executive compensation should not depend on uncontrollable exogenous shocks. Nevertheless, prior studies often find limited empirical support for this hypothesis in part because it is difficult to identify peers exposed to the same exogenous shocks. I propose a new way to identify peers and to test the RPE hypothesis in the context of a specific shock. In particular, I select peers based on the sensitivity of their stock returns to exchange rate fluctuations. I find evidence that firms respond to large exchange rate movements by ex post adjusting their peer selection to include peers with similar exchange rate risk exposure. Moreover, after allowing for ex post peer group adjustments, I find a much stronger support for the RPE hypothesis than most of prior work.

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Date Created
2017