Page 263 - ACFE Fraud Reports 2009_2020

Initial detection Method by Organization Type

43.2%
Tip 35.8% Not-for-Profit
41.1%
46.3%
13.0%
Management Review 15.4% Private Company
17.6%
11.6%
10.7%
Internal Audit 11.6% 16.7% Public Company
15.1%
6.5% Government
By Accident 6.8% 11.2%
5.3%
8.9%
8.2%
Detection Method Document Examination 3.9% 6.5%
Account Reconcilliation
3.9%
4.6%
6.0%
5.0%
6.5%
5.2%
External Audit
2.3%
1.2% 7.4%
Surveillance/Monitoring 2.6%
3.0%
2.8%
1.8%
Notified by Police 2.5%
1.2%
1.4%
1.2%
Confession 1.0%
1.1%
1.4%
0.6%
IT Controls 0.5%
1.2%
0.4%
0% 10% 20% 30% 40% 50%
Percent of Cases

When we look at how small businesses detect frauds, it is apparent that they catch a much lower proportion of schemes
through tips or internal audits than larger organizations. According to the chart on page 20, only 33% of small business
frauds are detected by a tip, and only 8% are detected by an internal audit. Additionally, a relatively large percentage
of frauds are caught by accident at small companies — nearly twice as many as at larger organizations. Many of these
discrepancies are likely due to the low rates of control implementation at small businesses.

2010 RepoRt to the NAtioNs ON OccuPATIONAl FRAUD ANd AbuSE | 19