Forensic Audit, How It Works and When You Need One

They share a word and almost nothing else.

The differences that matter

A statutory audit samples. A forensic engagement examines everything within its scope, because a sample proves nothing about a specific allegation.

A statutory audit works to materiality. A forensic engagement does not. A AED 20,000 theft matters regardless of your balance sheet size.

A statutory audit produces an opinion. A forensic engagement produces findings, with the documents attached.

And a forensic engagement is scoped narrowly on purpose. "Investigate the company" is not a scope. "Examine all payments to these four suppliers between these dates" is.

When to order one

Four situations.

You suspect a specific person or a specific process.
A shareholder dispute turns on what the numbers actually were.
An insurance claim requires quantified loss.
A regulator or a court has asked a question you cannot answer from your own records.

If you have a vague unease rather than a suspicion, a control review is the cheaper and better first step.

The first 48 hours, and the mistakes made in them

Owners lose more cases here than anywhere else.

Do not confront the person. Once they know, records disappear and accounts get tidied.

Do not start deleting or reorganising anything yourself. Altering records to make them clearer destroys their evidential value.

Do secure access. Accounting system, email, shared drives. Preserve what exists now.

Do write down what you know and when you learned it. Memory degrades and dates matter later.

How the work runs

Scope and questions agreed in writing first.

Data preserved, then analysed. Ledgers, bank statements, supplier masters, payroll, email where it is available and lawfully accessible.

Testing against the specific allegation, not around it.

Interviews, usually last, once the documents are understood.

A report setting out findings, method and limitations, with source documents attached.

What it cannot do

It cannot prove intent. It shows what happened. Why someone did it is a matter for others to determine.

It cannot recover money. That is a legal process, and the report is evidence for it.

It cannot find what was never recorded. Cash taken before it entered any system leaves no trace in the books, only patterns that suggest it.

Cost and proportion

Forensic work is priced by hours, because the scope determines the effort and neither side can fix it in advance.

That is why scope discipline matters. A tight scope on the four suppliers you actually suspect costs a fraction of a general investigation, and produces a better answer.

Where we fit

We take forensic engagements with a defined scope, and we will tell you when a control review is the better spend. If something has just happened, secure your records first, then call.