What it is
A fraud risk assessment asks where an incentive or pressure, an opportunity and a way to justify it could meet in this entity, then what stops it. This workbook lists schemes across fraudulent financial reporting, misappropriation of assets and corruption, scores them before and after controls and links each high residual risk to a response.
A second tab lists entity-level risk factors by pressure, opportunity and rationalization. A summary shows the schemes by rating and category.
When to use it
- When management performs its annual fraud risk assessment.
- Before a brainstorming session on fraud, internal or external.
- When the audit committee reviews anti-fraud controls.
What’s inside
- Ten sample schemes with the fraud triangle elements for each
- Inherent and residual likelihood and impact with a residual rating
- Triangle factors checklist with responses
- Summary by rating and category
Standard cited
This template follows COSO 2013 Principle 8 / AU-C 240. It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use. See AU-C 240 explained.
Questions
Which fraud risks apply in every audit?
The auditing standards require revenue recognition to be presumed a fraud risk unless rebutted, and management override of controls to be treated as a risk in every audit. Keep both on the list.
Who should take part?
People from different functions, including those who work in the process, since they know where a scheme would be easy. Keep notes of the discussion, not just the result.
Related templates
- Fraud Inquiry and Brainstorming Documentation (AU-C 240)
- Revenue Recognition Fraud Risk Presumption Memo (AU-C 240)
- Whistleblower Complaint Log
- COSO 17 Principles Assessment
Last updated 11/05/2026. All free templates.