Feburary, 2016

Risk Management

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Direct Tax

Forensic&Investigationservices

Forensic is simply a term that means “of or used in connection with courts of law”. In other words, forensic accountants are involved in matters of actual or potential litigation. Forensic professionals use their talent to search out and quantify commercial wrongdoing. It describes the range of accounting services which contemplate or may lead to the use of an accountant’s professional work or opinions in a court of law or other dispute resolution forum.

These services are wide ranging and include:

  • Investigations of suspected frauds or irregularities on behalf of private clients, corporate bodies, financial institutions, law enforcement agencies, regulatory bodies or the government;
  • Advising clients on fraud risks and practical methods of prevention and detection
  • Expert opinions on the quantum of losses in the context of breaches of contract or warranty, business valuation disputes, divorce cases, fatal accident and personal injury claims
  • Expert opinions in relation to professional negligence claims and on technical matters relating to auditing, accounting or taxation.
Our services include:
  • Fraud Investigations
  • Corporate Intelligence/ Pre-employment background checks
  • Brand Protection/ IPR Investigation
  • Fraud risk assessments
  • Fraud awareness workshops
  • Litigation support
  • Forensic Technology
  • Asset tracing

1. Fraud Investigations
The frauds one is most likely to encounter will depend on the nature of business and the way it is managed. In management ranks, expenses and purchasing are principal areas of fraud, with false reporting of financial information and siphoning of funds also being relatively frequent. The most frequent frauds by employees involve the theft of cash or inventory, or submission of false expenses claims. Cheque forgeries and purchasing frauds are also very common. Due to the increased sophistication of fraud and the requirement of prior experience in conducting fraud investigations, organisations have begun to realise that it is best for an expert who is independent and unbiased to conduct an investigation.

The overall objectives in a typical investigation are to:
  • Investigate and determine if the al eged material financial irregularities and/or improprieties have occurred.
  • Attempt to quantify whether or not any of these alleged financial irregularities resulted in a monetary loss, and
  • Attempt to identify persons who could be responsible for the aforesaid irregularities and/or improprieties.

  • A typical investigation involves the following procedures:
  • Review of necessary documentation available with the Company or any third party related directly or indirectly to the suspicions of alleged irregularities and/or improprieties.
  • Interviewing various employees, suppliers, customers, promoters and other persons considered necessary.
  • Field visits, where necessary, for collecting evidence, verifying any information, data, etc.
  • Conducting confidential background checks.

2. Corporate Intelligence/ Pre Employment background check
To answer the question of whether our clients can put trust in employees and business partners, we conduct background verifications to put our clients in a better position to make enlightened decisions. We conduct professional and impartial background checks on people and entities without violating their privacy to help base decisions on facts and not representations. We also help in collecting vital information to uncover potential business problems in acquisition targets.

3. Brand Protection/IPR Investigation
Agencies or institutions give funds either directly to various organisations for specific projects or are themselves involved in projects. Such projects could be for social and economic development of an area or even infrastructure development. A major risk that such agencies or institutions encounter is ensuring complete, efficient and correct utilisation of the funds earmarked and disbursed.

To help them manage this risk, PNK’s teams:
  • carry out field visits,
  • review the available documentation,
  • understand the local social and cultural issues involved,
  • speak to the local people and funding agency/ institution representatives,
  • investigate any suspected irregularities and/ or improprieties,

As PNK combines various skill sets to complete the above tasks and utilize a range of data available, the reports too reflect this diversity

Fraud Risk assessment
Risk is an integral part of business. Managing the risk of fraud is a crucial and integral part of any business. A fraud risk assessment is aimed at creating an environment that frustrates the perpetrator. We follow a tested methodology for such s assessments, i.e. form joint teams with the client to leverage off the knowledge of organisational culture, work environment and the industry knowledge. This approach allows for an immediate buy-in on the recommendations made, as client himself has been a part of the risk assessment exercise. Given our experience in conducting investigations, we are best placed to advice on how to mitigate these risks.

4. Fraud awareness Workshops
These workshops allow our experts to interact with a large number of people. In addition to conducting workshops under the aegis of various forums, client specific workshops are also conducted. Our team members have conducted seminars/workshops for professionals.
5. Litigation support
We provide expert opinions on technical questions of accounting, auditing, taxation or other areas of expertise. Leading to quantification of losses in respect to fraud, breach, disputed business valuations, loss of profits, insurance claims, intellectual property disputes and in many other situations. An integral part of our work is to act as expert witness and explain the basis of our computations, etc. either in an arbitration matter or a court matter.

6. Forensic Technology
Connectivity, while providing a plethora of opportunities, exposes your organisation to new and varied business risks and challenges. Threats arise from both within and outside the organisation, resulting in unauthorised access to information systems, disclosure of confidential and sensitive business information, accidental or intentional modification of information, interruption or discontinuity of business services, etc. Forensic Technology professionals can extract, secure and analyze electronic evidence from relevant systems in a way that provides a sound evidential basis for disciplinary, civil or criminal proceedings. Using data mining and data visualization techniques Forensic Technology can analyze data to provide an early indication of problem areas in a time sensitive way.

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