Page 95 - ACFE Fraud Reports 2009_2020

Table of Contents

External Audits
The most common anti-fraud measure among the victims in our study was the external
audit. Seventy-five percent of victims employed independent auditors. However, the
effectiveness of external audits in reducing fraud losses was not observable in our
study. In fact, the median loss was actually higher in organizations that had external
audits, as opposed to those that did not. Of course, there are several factors that
contribute to the presence and size of fraud. But it was disappointing to find no trend
indicating reduced losses as a result of external audits (such a trend did exist in 2002).
The absence of a measurable impact as a result of external audits is consistent with the
data we gathered on fraud detection, which showed that external audits generally
ranked low – behind By Accident – as a means of catching fraud.

Median Loss Based on Whether Organization had External Audits

$100,000
2004 $85,000 External Audit
Survey Year No External Audit

2002 $100,000
$140,000

$0 $30,000 $50,000 $90,000 $120,000 $150,000

Median Loss

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