Fraud refers to an intentional act by one or more individuals among management, those charged with governance, employees, or third parties, involving the use of deception to obtain an unjust or illegal advantage.
Management fraud involves one or more members of management or those charged with governance. Those charged with governance - "Governance" is the term used to describe the role of persons entrusted with the supervision, control, and direction of an entity. Those charged with governance ordinarily are accountable for ensuring that the entity achieves its objectives, financial reporting, and reporting to interested parties. Those charged with governance include management only when it performs such functions. Employee fraud involves only employees of the entity. Fraud may also involve third parties outside the entity through collusion by management, those charged with governance or employees.
