Page 343 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori
Approach: Utilizing control tests of transactions and substantive tests of balances.
Presumption: Exercising professional skepticism and due professional care.
Outcome: Formulating an audit report opinion, which may include qualifications such as "subject to" or
"except for".
Forensic Accounting
Objective: To uncover facts and evidence through focused scrutiny. To identify and confirm the nature of any
violations. Narrow, cantered on validating transactions and balances.
Skills: Utilizing scrutiny and analysis, fact-finding techniques, and conducting interviews.
Approach: Engaging in focused testing to substantiate suspicions or allegations.
Presumption: Maintaining neutrality throughout the process.
Outcome: Presenting the gathered evidence in a court of law for judgment.

(CNO- FA.040) Forensic Accountant Professional
Role: Forensic Accountant Professionals are tasked with analyzing, interpreting, and presenting complex
financial and business issues in an understandable and substantiated manner, looking beyond mere numbers to
grasp the business reality.
Skills and Experience : Before accepting a task, they must ensure they possess the necessary skills and
experience, given the specialization of forensic accounting which demands a deep understanding of fraud
investigation techniques and the legal framework.
Understanding types of frauds: They should be well-versed with different types of frauds and the appropriate
methods for evidence collection.
Practice V/s Employment: Forensic Accountant Professionals can work in public practice or be employed by
various organizations including insurance companies, banks, and government agencies.
Forensic Accounting Services
1. Financial Malpractices:
- Financial Statement manipulations
- Fund diversions/Asset tracing
2. Regulatory and Compliance:
- Anti-Money laundering
- Licence Fees/Dues/Tax Evasion
- Suspicious transactions under IBC (Insolvency and Bankruptcy Code
3. Transactions and Valuations:
- Related party transactions/valuations
- Valuations/Estimations of loss/damage
A Forensic Accountant Professional is often involved in:
1. Fraud Prevention: Reviewing internal controls for adequacy and consulting on the development and
implementation of an internal control framework aligned with the organization's risk profile.
2A. Fraud Detection: Engaging in the investigation and analysis of financial evidence to detect frauds and
trace misappropriated funds.
2B. Computer Forensics: Creating computerized applications to aid in the recovery, analysis, and presentation
of financial evidence.
3. Expert Testimony: Assisting in legal proceedings, including offering expert testimony in court and
preparing visual aids to support trial evidence.

(CNO- FA.060) Process Of Forensic Accounting
Step 1. Initialization
Purpose: Begin by clarifying the motive, purpose, and utility of the assignment to remove any doubts.

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