Thursday, December 29, 2011

Happy Holidays from Internal Auditing

It's required, in bank regulation,
That each trader have two weeks' vacation;
While preventing their burnout,
An audit may turn out
A case of a "rogue" operation.

During the holidays (or the dog days of August), when the thoughts of some bankers turn to carefree vacations, others contemplate... forensic accounting. Bank regulations call for every employee to take two consecutive weeks off each year, to give internal auditors sufficient time to uncover whatever financial fraud they might secretly be working on. This is based on the observation that such frauds usually require the frequent oversight of one or more conspirators, whose forced, temporary removal may cause the scheme to unravel.

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