You might know about yearly audits as a business owner. But do you know that there are different types of audits to meet the specific audit needs of business?
One such audit is a forensic audit. Although many business organizations do not conduct forensic audits, they should. Why? Let’s check out
What is a Forensic Audit?
A forensic audit is a process of examining the financial records of a business enterprise to identify areas of fraud, misrepresentations, errors and mistakes. This type of audit is crucial in case of litigations or any law cases as it’s useful in court or legal proceedings.
How Forensic Audit Helps Businesses?
Forensic auditing services can investigate various critical matters, including the following:
If you are getting your accounts audited by a forensic accountant, the auditor will look for:
- Conflict of Interest
When a fraudster within the company has misused his/her power for personal gains, it can be detrimental for the company. For example, a finance manager approves of all the inaccurate expenses of the employee who is related to him/her. Although the manager is not directly getting any benefit, he/she is offering inappropriate approval. It will also be amount to a conflict of interest.
If an employee within an organization or outside of the organization influences the operations of the business for his/her personal benefits by paying money, it is known as bribery.
If employees within the company demand for money for awarding a contract or for completing a business procedure, it is known as extortion.
Forensic audit services in Delhi NCR help you to identify and mark the fraud areas with your business operations. The most common fraud that is often discovered by them is asset misappropriation. Some of the most common examples of misappropriations are raising fake invoices, misuse of assets, misappropriation of cash, theft of inventory, payment to non-existent supplier or employees, etc. Many businesses make such asset misappropriations to escape taxes.
Financial Statement Fraud
Many companies become a part of this type of fraud for two reasons:
Ø To showcase a better financial performance than actual
Ø To show lower profits than actual
The main goal is to represent fraudulent figures that may make the financial statement beneficial for the company. Companies have a pressure of improving liquidity, bonus payments or market performances. This pressure drives the company employees to use such activities.
Why Choose A Forensic Audit Service in Delhi NCR?
Before we understand why you must hire a forensic audit company in Delhi NCR, you need to understand who can conduct a forensic audit. It is a prevalent myth that any CA can conduct forensic audit service which is not true. It is a specialized field and requires a distinct set of skills. Therefore, you need to hire accountants who are specially trained to conduct a forensic audit. Forensic audit services in Delhi NCR like VGNC have a strong team of forensic accountants. They are not only trained but also experienced in this domain.
Forensic auditing not only helps you discover faulty areas in your business but also allows you to correct them which proves to be beneficial for your business in the long run. If you want to know more about forensic accounting or want a hire a reliable service, give VGNC a call today!
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