During a recent audit of New Jersey's accountants, there has been a disturbing trend found. A record number of accountants have been lying about their continued education. The report said that about 780 of 20,000 of licenses accountants in New Jersey were falsely reporting that they returned to school to take additional courses, which are required to do every three years.
This doesn't seem like a lot but it only takes one person to lie and commit a major fraud, as we all saw with Arthur Anderson. So, if there 780 people are capable of lying on their continuing education, what else could they be lying about. Some of the offenders included local tax preparers, school accountants, state officials, and members of large accounting firms.
Despite all of the negative things related with this report there are some positives to take away as well. One positive is that they were actually found out to be lying. This is because the accountancy board used a new method in looking for fraud. They used to randomly select about 10% of applications but now they compared applications with enrollment records of the law and ethics course that is required. Another positive outcome of this situation is that all licenses who need continuing education will now be looked at closer. After something like this it is obvious that better internal controls have to be set up so this doesn't happen again.
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