Title: Detecting asset misappropriation: a framework for external auditors

Authors: Rasha Kassem

Addresses: The University of Northampton, Boughton Green Road, Northampton, NN2 7AL, UK

Abstract: Fraud is a major concern for investors, regulators, and external auditors. Of particular concern is asset misappropriation because it was given less attention in prior audit literature as well as the audit practice though it is the most common type of occupational fraud. This motivated the current study to examine areas related to asset misappropriation that had never been examined before and alert external auditors in Egypt to a type of fraud which was given less attention. The current study also proposed a framework for external auditors that might help them properly assess and respond to fraud risk factors arising from asset misappropriation. This framework was designed after careful consideration of prior audit literature, Egyptian auditors' perceptions of the most important red flags of asset misappropriation, and their experience on the most effective fraud risk response. Study data was gathered using prior literature, a questionnaire, and a semi-structured interview.

Keywords: occupational fraud; asset misappropriation; red flags; fraud detection; external auditors; auditor reputation; audit procedures; audit quality; audit expectation gap; audit risk; auditing; Egypt.

DOI: 10.1504/IJAAPE.2014.059181

International Journal of Accounting, Auditing and Performance Evaluation, 2014 Vol.10 No.1, pp.1 - 42

Received: 10 Aug 2012
Accepted: 18 Feb 2013
Published online: 17 May 2014 *

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