Offering an online fraud examination course without a textbook

In this column, I discuss the content and delivery of a senior-level, undergraduate elective course in fraud examination. While many such courses exist, this course has two unique features: a) It's offered in a completely online environment and b) it doesn't rely on a textbook but uses ACFE videos and related articles. First, we'll look at the structure and content of the course; second, we'll examine some advantages and disadvantages of using this approach.

Structure and Content

• Knowledge: Memorizing material "by rote" and recalling memorized data. For example, students might be asked to list the three elements of the fraud triangle.
• Comprehension: Interpreting instructions and explaining concepts using original language. For example, students might be asked to explain each element of the fraud triangle in their own words.
• Application: Using learned material in a new situation. For example, students could be given a case and asked to identify specific examples of the elements of the fraud triangle.
• Analysis: Breaking down a large "chunk" of material into component parts. Students might be presented with another model (such as the M.I.C.E. model discussed by Kranacher et al., p. 205) for explaining what "causes" fraud, then compare and contrast that model with the fraud triangle.
• Synthesis: Creating a "whole" from disparate parts. Students could be given a short case with multiple opportunities for its characters to commit fraud, which they would use to explain how they would obtain information about each element of the fraud triangle.
• Evaluation: Making judgments about the value of materials and ideas. This level of Bloom's taxonomy isn't assessed in the course described here because most undergraduates are cognitively unequipped to make such judgments. 

The course comprises five units of material, each lasting two weeks: 

• Unit 1: Fraud basics.
• Unit 2: Fraud causation theories and red flags.
• Unit 3: Fraud examination.
• Unit 4: Role of information technology.
• Unit 5: Fraud case. 

Each unit has its own learning objectives, resource materials (videos and articles) and assessment tool. Those items are summarized below for Unit 1 and are available on request for the other units from me: 

     1. Learning outcomes for Unit 1 (fraud basics)
          a. Define occupational fraud and abuse.
          b. Describe the three basic categories of fraud schemes identified by the ACFE.
          c. Explain and give examples of types of fraud within each category.
          d. Explain the process for becoming a CFE.
          e. Outline the structure of the CFE Exam.
     2. Resource materials
          a. ACFE videos (digitized and uploaded to Blackboard, but not reproducible by students in accordance with the ACFE's guidelines)
               i. "Cooking the Books: What Every Accountant Should Know about Fraud"
               ii. "Other People's Money: The Basics of Asset Misappropriation"
          b. Periodical articles
               i. "Corruption: Causes and Cures" by Dr. Joseph T. Wells, CFE, CPA, Journal of Accountancy, April 2003, http://tinyurl.com/akak6bx.
               ii. "Financial Statement Fraud: Part One" Fraud Magazine, November/December 2003. "Financial Statement Fraud: Part Two" Fraud Magazine, January/February 2004.
               iii. "So You Want to Be a Fraud Examiner" by Dr. Joseph T. Wells, CFE, CPA, ACFE webinar, December 2002.
               iv. "The Many Faces of Fraud: Part One" Fraud Magazine, March/April 2002.
               v. "The Many Faces of Fraud: Part Two" Fraud Magazine, May/June 2002.
          c. Other resources
               i. Latest version of ACFE's Report to the Nations on Occupational Fraud and Abuse.
               ii. ACFE.com.
     3. Assessment — Students complete a 10-question multiple-choice exam based on the unit's learning outcomes. Questions test students' abilities at multiple levels of Bloom's taxonomy of educational outcomes. The questions are randomly selected from a pool of 20; students may take the exam up to three times. Each attempt must be completed in a single sitting of not more than 30 minutes; the score of the final attempt is counted in the grade, whether it's higher or lower than previous attempts. 

Overall, the course includes four videos and 22 articles. The table below provides additional details on the assessment tools for the other units. 

Advantages

The material is often more current than that found in traditional textbooks. For example, a then-recent Fraud Magazine article ("The Ten Tell-Tale Signs of Deception" by Paul M. Clikeman, Ph.D., CFE, January/February 2012) was added to the Unit 2 reading materials shortly after it was published. Most textbooks undergo major revision once every two to three years; in a field as dynamic as accounting, they can become outdated quickly.

Disadvantages

It's Hard Work, But the Students are the Winners

Teaching any course — including fraud examination — without a textbook is not a task to be undertaken lightly. But, when the course is well prepared, students experience significant benefits.

Sidebar:
ACFE Anti-Fraud Education Partnership

The ACFE Anti-Fraud Education Partnership makes it easy for your college or university to provide expert anti-fraud training to your students. Universities around the world have become key providers of anti-fraud knowledge and training through this unique partnership. The ACFE established the partnership to address the unprecedented need for fraud examination education.

To begin the process of joining the partnership, your college or university must:

• Submit a letter of intent on university letterhead stating its plan to begin a course titled Fraud Examination. 
• Implement the course as a three-hour credit undergraduate or graduate level program.
• Provide the instructor's name (the instructor must be an ACFE member) and the date in which the course will be implemented.
• Acknowledge and return the Terms of Use.
• Provide instructor and student evaluations within 90 days of course completion.

The ACFE will then provide your institution with 12 free videos, accompanying workbooks and resources to support your Fraud Examination course.

Bob Hurt, Ph.D., CFE, is a professor of accounting at California State University in Pomona and owner of R.L. Hurt Consulting Services, offering fraud examination, enterprise risk management, expert witness and speaking services. He's a member of the Inland Empire chapter of the ACFE.   

George R. Young, Ph.D., CFE, CPA, is an associate professor at Florida Atlantic University and the academic director of the forensic concentration in the Masters of Accounting program at the university. He is chair of the ACFE Higher Education Advisory Committee and co-author of "Forensic Accounting and Fraud Examination," a textbook published by McGraw-Hill. 

References

Bloom, B. "Taxonomy of Educational Objectives Book 1: Cognitive Domain." (2nd edition) Addison Wesley, 1984.

Kranacher, M., R. Riley and J. T. Wells. "Forensic Accounting and Fraud Examination." John Wiley & Sons, 2011.

The Association of Certified Fraud Examiners assumes sole copyright of any article published on www.Fraud-Magazine.com or www.ACFE.com. ACFE follows a policy of exclusive publication. Permission of the publisher is required before an article can be copied or reproduced. Requests for reprinting an article in any form must be emailed to FraudMagazine@ACFE.com.