Fraud refers to intentional misrepresentations of financial information by one or more individuals among management, employees or third parties.
Fraud may involve:
a. Manipulation, falsification or alteration of records or documents.
b. Misappropriation of assets
c. Suppression or omission of the effect of transactions from records or documents.
d. Recording of transactions without substance.
e. Misapplication of accounting policies.
Error refers to unintentional mistakes in financial information such as:
a. Mathematical or clerical mistakes in the underlying records and accounting data.
b. Oversight or misinterpretation of facts; or
c. Misapplication of accounting policies.