The article briefly explains the concept of Forensic Auditing and the use of the technique in the detection of the frauds. The relevance of the concept has been highlighted -especially in the emerging scenario of continuous development in the fields of accounting and auditing. The article also touches upon the various inter-related concepts and the vital areas where the technique of Forensic Auditing can be best used in detecting the misappropriations and manipulations in the financial as well as operational matters.
CA Rubneet Kaur
B.Com, M.Com, MBA
rubneet@gmail.com
Introduction
The manipulations and misappropriations in the corporate world relates back to Sept 1720 when after the War of Spanish Succession, the UK signed the Treaty of Utrecht 1713 with Spain, ostensibly allowing it to trade in the seas near South America. In fact, barely any trade took place as Spain renounced the treaty; however this was concealed on the UK stock market. A speculative bubble saw the share price reach over £1000 in August 1720, but then crash in September. A Parliamentary inquiry revealed fraud among members of the government, including the Tory Chancellor of the Exchequer John Aislabie, who was sent to prison.(source-online published story)