Vishnu Mobiles Ltd., is a domestic company dealing in mobiles of famous international brands. During August, 2018, the company suspects that its sales volume has come down, thanks to the red flag raised by the Sales Mana

Forensic Audit of Corruption Fraud There are three types of Corruption Fraud: Conflicts of Interest, Bribery, and Extortion. Research shows that corruption is involved in around one third of all frauds. In a conflict of interest fraud, the fraudster exerts the influence to achieve a personal gain which detrimentally affects the company. The fraudster may not benefit financially, but rather receives an undisclosed personal benefit as a result of the situation. For example, a manager may approve the expenses of an employee who is also a personal friend in order to maintain that friendship, even if the expenses are inaccurate. Bribery is when money (or something else of value) is offered in order to influence a situation. Extortion is the opposite of bribery, and happens when money is demanded (rather than offered) in order to secure a particular outcome. Methodology to be adopted The following methodology may be adopted by the Forensic Auditor, singly or in combination: Conducting interviews with the employees of the company, especially in the sales division. Encourage the employees to post their views about L and M, in suggestion boxes anonymously kept in this regard. Where the company policy permits, check the email history of L and M for the past one year. Buyers of the two mobile products are to be interviewed to ascertain whether there is any collusion between any of them and L (or M). Forensic auditor may obtain SOP for sake for these two mobiles and check whether they have been adhered to by L and M. It is possible that L and M have colluded with each other, along with some buyer. Costly products of Orange might have been billed as the other product. Confirmation of balances should be obtained from various buyers and cross checked with company records. GST returns for the month should be scrupulously checked and any fraud pattern visible therein must be looked into. Look for red flags. Were L and M too sincere in their work, without even taking sick leave or going for vacation, though they were entitled to? Market Intelligence techniques can be adopted wherein cover agent will visit the suspected person's residence area to get an understanding his lifestyle, discreetly enquire about him with the few people in the area adjoining etc.