Corporate fraud has been a serious risk to businesses of all sizes and types. Some of the recent cases of large corporate frauds have shown that dishonesty is prevalent everywhere, and it affects the profitability, efficiency, and reputation of the organization.
Forensic auditing includes a vast spectrum of activities, and it is not limited to regulatory guidance. It is a very specialist type of auditing, and it requires a team of highly skilled forensic auditors to carry out the fraud investigation. The process of forensic auditing is a very sensitive one and requires cooperation from both the client and the forensic auditor. We are here to assist you through every step of forensic accounting and forensic auditing to make it a straightforward process.
WHAT IS FORENSIC AUDIT
Forensic auditing is defined as an examination and investigation of a firm or individual’s financial statements and records to find evidence that can later be used in the court of law. There are various reasons for conducting forensic auditing, such as for prosecuting someone for embezzlement, financial crimes, or fraud.
The process of forensic auditing is most likely to be similar to other types of auditing, as it includes phases like planning, investigating, reviewing, and reporting to the client. The reason as to why the investigation is conducted is to discover if the fraud actually took place, and if it did who were involved, to quantify the monetary loss and finally present the record to the client and ultimately to the court.
Therefore, in simple words, it can be concluded that forensic auditing is a procedure carried out to produce evidence. The auditing techniques helps in identifying and gathering evidence to prove various aspects like duration, the involvement of people and quantity of loss, etc.
TYPES OF FRAUD
As a forensic auditor, we are asked to audit or investigate different types of fraud. While one can categorize fraud into many different types, they can broadly be categorized into three types:
ASSET MISAPPROPRIATION
As per our experience, it is the most common fraud by far. It includes cash theft, which can be anything from stealing petty cash to cash from the office vault. Fraudulent disbursement is also an example of this fraud where the employees might make payments to fictitious suppliers. Fictitious invoices, misuse of assets, and embezzlement of stock in trade are some of the examples of asset misappropriation.
CORRUPTION
It further includes three types of corruption that are extortion, bribery, and conflict of interest. Extortion means demanding money for securing an outcome from it. Bribery means offering money to obtain a desired place or status. Conflict of interest happens when fraudster influences a person to achieve personal gain, which is most detrimental for the company.
FINANCIAL STATEMENT FRAUD
This type of fraud causes material misstatement in the company’s financial statement. It occurs when someone intentionally falsify the financial statement by omitting, adding, or misrepresenting the facts. It is done to deceive the users of the financial statements and influence their decisions.
Our processes for conducting forensic auditing are as follows:
Acceptance of invitation to conduct forensic audit
Understanding the objectives set by the client
Develop a plan regarding the investigation based on the objectives set by the client. The objectives can include identification of the type of fraud, the person behind the fraud, quantification of loss, gathering specific evidence to present in the court of law
Commence the fraud investigation by starting to gather evidence after detailed discussions with the client and understanding of the objectives behind the forensic audit. Sufficient evidence is collected to prove the fraudster’s guilt in the court of law. Analytic procedures, computer assisted auditing techniques, substantive techniques like reconciliation etc are the forensic audit techniques used to gather evidence.
Usually the investigation leads to the court proceedings against the suspect. Our team of experts will be present at the court to explain the evidence and our findings. We make sure we present the evidence very clearly and professionally.
CAPITAL EXPENDITURE REVIEW
SAS undertake capital expenditure review to find out the real value of assets and the amount of overstatement or understatementCOMPUTER-ASSISTED REVIEWS
We undertake a review of software programs, tools, emails, and reports, to uncover fraud and misstatementsRECORDS REVIEW
We provide records review service where we check vouchers, invoices, registers, and other records to verify their accuracy and authenticityEXPENSE REVIEWS
We analyze expenses to find out the extent of an overstatement, or understatement for a wrongful intention
SAS understand the sensitivity attached to carrying out of forensic auditing. We have an expert team of auditors who are well knowledgeable in fraud investigations. The team has carried out a number of forensic auditing for various clients. Our team of forensic auditors works relentlessly and uses the latest techniques and methods to carry out this forensic auditing service.We provide our auditors specialized training, which upgrades their skills and also ensures credibility and professionalism. Our years of experience and perfection in all the services we carry out make us an ideal choice for providing forensic audit services in Ghana.
