In the professional course Company secretaryship, there are multiple areas of specialization. A forensic audit is a professional program that reduces fraud, deceit, and financial misplacement. Efficiency in the corporate culture is a must for economic growth. The corporate sector gets empowerment because of a forensic audit. This blog clarifies the connection between forensic audit and the company secretary course. Forensic audit –ICSI is a course to grow exponentially in the job market.
Types of forensic audit:
Financial theft, bankruptcy, defaulting on debt, securities fraud, economic damages, Tax evasion or fraud, M&A related lawsuits, and corporate valuation disputes are the different types of forensic accounting branches. The areas in which forensic accountants work are insolvency, insurance claims, divorces, fraud, embezzlement, skimming and financial theft. Accountants focus on the value of the company, tax bills, fraud, and damages. These points help in collecting forensic evidence. This evidence is presented in a court of law. The courses which have forensic accounting as a subject are chartered financial analyst, chartered alternative investment analyst, certified public accountant, certified financial planner, financial modelling and valuation analyst, associate company secretary and financial risk manager certification.
What is a forensic audit in banks?
The role of CS in forensic audit is to check the accuracy and taking decisions. Company secretaries provide suggestions in the Credit decisions, investment decisions, investigation of the income and expenditure, investigation of deviation of guidelines, unlawful activities, wrong decisions, organisational structure, illegalities in recruitment, corporate governance, relativity in the industry, respecting stakeholders, strategy, promotion and transfers, social responsibility and systems and procedure. For credit decisions, it is essential to check the RBI guidelines. For investment decisions, the parameters are actual return, anticipated return, prevention of loss, and reasons for less profit. As there is more competition with banks, there is a need for information sharing. For sharing information and creating relativity factors among other banks forensic auditing gives support. Certified bank forensic accountant examination provides the certificate for the graduates. Graduates with work experience in private banks, nationalised banks, non-banking finance, cooperative banks, financial institutions and Credit Card Companies can apply for this examination.
Forensic audit in Companies:
The financial audit and forensic audit have similar functions. Planning the process, gathering evidence-based information, and writing a report are the three steps in a forensic audit. The companies with loan accounts need to present the report of non-performing assets. A forensic audit is helpful to understand the non-performing assets, and it is an event-based one. The investigations show the fair and true view of the financial statements. The payment systems pay way to the fraudsters. Creditors use forensic accounting to satisfy the promoters. A forensic audit is essential in companies for stakeholders and banking loans. Satyam scam and Kingfisher Airlines scandal are financial frauds. These frauds raised the value of forensic accounting.
Foreign opportunities for forensic audit professionals:
Role of Company secretary as an internal auditor ensures the meeting records, tax planning, corporate litigation, management of capital and debt. Chartered accountants and company secretaries are eligible for forensic accountancy. Graduates with two years of experience in fraud-related business processes are eligible for forensic accountancy. During mergers and acquisitions, economic crime investigations, tax investigations, specialised audits, litigation support, and terrorist investigations, there is a need for a professional with knowledge about forensic auditing. Unlike India, forensic accountancy has vast demand in foreign countries. It boosts the opportunities for forensic accountancy. Indian certification and global certification both are essential to work abroad.
ICSI certificate course on Forensic audit:
Some of the Indian certifications in forensic audit are CFAP, CIFA, CBFA, and CSMFA. If the company secretaries have experience in handling frauds, then forensic auditing enhances their practical intelligence. The students who have cleared executive level and professional level are eligible to apply for this course. The professionals can work with law enforcement agencies like CBI, IRDA, SFIO, and RBI. The other opportunities are accounting firms, compliance departments, corporate sector, boutique firms, compliance departments, and law firms. The course content is an overview of fraud and misconduct, financial statement fraud, unveil asset misappropriation schemes, legal and regulatory requirements, problems related to tomorrow’s world, and fraud in a digital environment. A forensic audit is an elective paper in the professional programme of ICSI.
Final words:
There is a need for forensic investigation in law firms. The clients in law firms ask about financial misstatements, litigations involving complex accounting issues, fraud allegations, and embezzlement. Lawyers with experience in evaluating financial data understand the critical requirements of clients. The domain knowledge is essential for understanding the clients from different corners. International arbitration requires analysis of complex financial data, economic data, cultural diversity, technical issues, currencies, and language complexities. The evidence can be oral or documented, and the experts provide clarity on the information. SEBI demands the forensic audit of the registered companies and banks. This demand is a sign that it is a growing profession. Forensic auditor salary ranges from 46 lakhs to 24 lakhs per year. The fraud investigation, internal auditing skills and forensic auditing skills enhance the opportunities and growth of forensic auditors.
