Dubai, UAE businesses involve dealing with many stakeholders, such as suppliers and vendors, distributors and associated supply chains, company labor workforces, company management, shareholders, and company management. The strategic goals and many external factors are key to the success or failure of a business.
Sometimes, businesses can face problems and become inefficient because of many factors. An internal audit can be used to assist the board of directors, shareholders, and legal authorities in identifying and determining any malpractices that could affect the interests of various stakeholders.
What is Forensic Audit?
An analysis and thorough review of an organization’s financial records, or the ability to deduce facts from a court of law can be described as a Forensic Audit. Forensic audit is a special type of auditing within the accounting industry. Usually, large accounting firms have a department that specializes in forensic auditing. This field requires expertise in both accounting and auditing practices, as well as expert knowledge of the legal framework for forensic audit.
The steps of a forensic audit are similar to any other financial audit. They include thorough planning, gathering records, and forming reports. However, there is an additional step that may be required: attendance at the court of law. The lawyers of the litigants present evidence that a crime has been either proven or not, which determines the extent of the damage. In the event of a trial before a judge, they also explain their findings to the defendants.
Also read: Difference between an Internal Audit & a Forensic Audit in Dubai
Need for Forensic Audit
A forensic audit is used to prosecute an individual or group of people for fraud, embezzlement, or other financial crimes. A forensic internal audit specialist in Dubai can be called to assist in the trial proceedings. To prove and check the following offenses within an organization, forensic audits are necessary.
Corruption or Fraud Asset
Additional illegal activities can be discovered and confirmed by forensic audit investigations. In the following cases, the evidence collected in a forensic audit would be used in court:
Steps that Audit Companies in UAE do to Conduct Forensic Audit
Plan the Audit
The planning stage is where the forensic auditor, along with his team, will plan the investigation and set deadlines to reach their audit objectives.
Gathering Evidence
The audit team will collect evidence to support the allegations of fraudsters. It will also reveal details about the fraud scheme and document any financial losses.
Submit a Report
A forensic-certified audit in Dubai team will prepare and submit a detailed written report that includes all fraud findings. This report will be available for the client to use and allow them to file any legal cases as necessary.
Procedures in a Legal Court
To explain the evidence and the method used to identify the suspect(s), the forensic internal audit specialist must be present at court proceedings. Internal Audit Services Dubai should explain complex accounting issues in simple language to those who don’t understand legal terms or accounting terms.
Here Are the Benefits of Forensic Audits in the UAE
- Legal assistance
- The Simplification of Litigation
- Monitoring and curing malpractices
- Disputes Resolution
- Brand Reputation Increased
Legal Assistance
Companies will benefit from having an independent auditor examine their legal affairs. Frauds can prove costly to a business and cause huge losses. To avoid these scenarios, a forensic audit is performed. Forensic Accounting can help solve financial crimes within the company. These can include bribery within departments as well as fraud and money laundering within the company. Forensic accounting can be used to detect and prove crimes and help in gathering evidence.
The Simplification of Litigation
Companies can use forensic auditing to investigate a specific department. This includes determining the exact price of raw materials and products, potential profitability, and presenting the total market value. For any business lawsuit, forensic auditors are mandatory.
Monitoring and Curing Malpractices
Forensic audit services are used by different companies to track any illegal activities or malpractices in a company. They gather accounting evidence so that management and board members can take the necessary actions.
Disputes Resolution
Employing the appropriate forensic audit service can resolve contractual disputes between companies and business vendors or clients.
Brand Reputation Increased
Forensic auditing can be a valuable tool in identifying unprofessional conduct within an organization and alerting the management to take the necessary remedial steps to improve and maintain the company’s goodwill.
Imagine that a company is having problems with contracts when dealing with clients and business vendors. It’s time to implement forensic accounting in your business premises. This will allow companies to resolve disputes and improve the quality of their offering, which will lead to increased profits.
Why You Should Choose Audit Firms in Dubai As Your Audit Function Partner
Audit Firms in Dubai is one of the most reputable Audit firms in the UAE. Expert consultants are available to assist companies with all aspects of forensic audits. Trust and quality are the most important aspects of our work. This has allowed us to help our clients resolve internal and external disputes.
Kasun Liyanage is an Audit Manager with over 7 years of experience dealing with diversified corporate clients. He not only manages the team’s work schedule but also is an expert in handling audit areas such as external audits and fraud investigation, Internal control benchmarking and best practices and well as preparation of financial statements and IFRS compliance.
