Technical Note
FRAUDS AND THEIR PREVENTION IN ORGANISATIONS
INDUSTRY :-
AREA :BUSINESS ETHICS
ORGANIZATION :-
LENGTH :16
LUMS No :24-001-2014-2
PUBLICATION YEAR : 2014
ABSTRACT:
Frauds consume precious organisational resources, so their prevention remains a major concern for all organisational stakeholders. This note is an attempt to understand the reasons for organisational fraud, its prevention mechanisms and the causes of those mechanisms' failures. Most of the instructional resources available on this topic are either too technical in nature or are too generic. Technical texts focus on fraud types and the specific tools and techniques that can be used to prevent them. Most of the material written by accountants (for accountants!) falls in this category. In contrast, there are these generic commentaries written by sociologists that address this issue from a sociological standpoint. While very insightful, their utility for executive training is limited. Most executives find these materials too abstract for their liking. The primary motivation for writing this note is to create an instructional resource which falls in between these two extremes. The note covers technical issues, e.g. basic ingredients of internal control systems. At the same time, it links organisational frauds with crisis and contradictions of the capitalist mode of production. The author feels that this middle of the road approach can be of greater instructional value for MBA and executive education.