Finance Monthly - May 2022

50 Finance Monthly. Bank i ng & F i nanc i a l Se r v i ce s What are the most common cases the forensics team at GHJ works on? We can divide our practice into two broad areas: Forensic investigations and litigation support. Forensic investigations involve assisting companies to analyse allegations of wrongdoing. This could involve fraud, theft of cash or other assets and other misconduct, but can also include financial mismanagement, financial misreporting, as well as a review of the company’s internal control procedures. In these matters, we are generally engaged by the board of directors or senior management to provide clarity and solutions to the issues on hand. For example, if we are asked to investigate an allegation that someone has “cooked the books”, the question we would investigate may be: • Who cooked the books? • When were the books cooked? • How much were the books cooked? • How do we un-cook the books? Procedures for resolving these matters may involve but are not limited to performing analytical procedures, interviewing key individuals, reviewing complex accounting data, and reviewing specific transaction details. For instance, various analytical procedures allow forensic accountants to identify unusual or unexpected trends that would otherwise be obscured in thousands or more complex transactions. Common types of analytical procedures are analysing transactions made on weekends or holidays, large round numbers, common duplicate amounts, and unusual keywords. We also analyse large data sets by cross-referencing employee details against vendor details for concealed theft of assets between related parties. In the same data set, vendors with P.O. boxes are closely inspected, which is a popular method for concealing the perpetrator’s real location. In addition, we can verify employee details to identify “ghost employees.” In this procedure, we look for fictitious employees or other individuals receiving paychecks who are not actual employees. Interviewing key individuals is also a critical component of a forensic investigation. Key individuals generally include the suspected perpetrator, the suspected perpetrator’s supervisor, peers, and any other employees with whom the suspected perpetrator had a close working and/or personal relationship. They also include other employees with the authority to sign checks, approve invoices, transfer funds, hire employees, approve pay increases, etc. Interviewing can reveal a wide range of facts about the suspected fraud and provide insight into a larger scheme that was not questioned before. Additionally, interviews provide us with crucial qualitative information, such as the suspected perpetrator’s expensive hobbies or other red flags in committing fraud, including financial trouble or other personal pressure such as family issues or substance abuse. Overall, a forensic investigation is a dynamic and iterative process. We employ a wide array of tools to provide answers for our clients; however, it is always crucial to adapt and pivot as necessary with the discovery of new information and data. For engagements involving litigation support, we assist attorneys and clients in evaluating and untangling complex matters with our expertise. Our services may include analysing “There are many key traits to be a great forensic accountant and an adviser, but it really comes down to two key traits: a drive to solve problems and clear communication with the attorneys and clients.”

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