Forensic Audit

Forensic is sine qua non, where organized crime and financial frauds are common.

Fraud is an overall wonder that influences economy as a whole and all segments of the economy. Corporate fraud is on the rise in India, compelling more management to conduct forensic audits. Fraudsters are leveraging innovative methods to target different industries and attacking some more often than others. Usually the fraudsters target the information of financial nature to reap the monetary benefits. Fraud is an ever-present and growing risk. For digitally minded businesses, managing fraud risk is a delicate balancing act between fraud detection and the customer’s digital experience. A system needs to be strong to control internally in a way that best practices are used to prevent various frauds.

All the industries are vulnerable to fraud and the effects can be more damaging. Frauds cannot be eliminated but the risk of frauds can be mitigated to a great extent.

• Below mentioned are few ways that can contribute in reducing the risk of frauds: Monitoring transactional data to proactively identify irregularity indicative of fraud.
• Establishing proactive communication with employees around fraud by educating the employees regarding the use of company’s technology.
• Internal controls have been the standard to prevent fraud in the workplace. Hence, it is essential to establish an internal control framework “for identification or risks and controls”.

ASM

PSB Reforms Agenda – Ease of Access Service Excellence (EASE) was launched to encompass a synergistic approach to ensure prudential and clean lending, better customer service, enhanced credit availability and better governance. Accordingly, Department of Financial Services, Government of India, indicated several action points, one of which is "Tie up with Agencies for Specialized Monitoring (ASM) for clean and effective post sanction monitoring and follow up on Common engagement basis in case of consortium lending, having large credit exposure (above Rs,250 crore) and exposure of a specialized nature. Indian Banks were reeling under a Distress Debt of around USD 200 Billion and were in dire need of debt restructuring and infusion of fresh capital.

ASM will be applicable for all debtors where exposure is above INR 250 Crore. The Scope of work shall include:

• Concurrent Review and Monitoring Procedures (for Working Capital)
• Cash Inflow Monitoring
• Cash Outflow Monitoring
• Fund Flow Analysis
• Non-Cash Parameters

S A A R K & CO specialized in onsite as well as off-site monitoring of the business/project, accounting and analyzing, evaluating and monitoring the borrowal account/project financially as well as technically with its strong techno-financial capabilities, is rightly placed to offer a conduct root cause analysis of the incipient sickness/stress in the borrowal account and suggest remedial measure to branch 360 degree overview to the lenders, with regard to their exposure to large borrowers. We can monitor the progress of the implementation/operation of projects on real time basis. Simultaneously, we can monitor the operating and non-operating financial transactions of the debtor, including cash flow monitoring. S A A R K & CO can take into account the concern areas from bank as well as Promoter and suggest remedial measure during the term of engagement.