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Financial Investigations (Forensic)

Financial Investigations (Forensic)

Financial investigation is a process that is carried out with an aim to prevent problems related to encroachment on company property and its improper use, as well as to collect evidence for the instances that have already occurred.

Providing company’s economic security has always been important for business owners and leaders. The issues of fraud, theft, misuse of official position, raiding, corruption and other issues may arise during the process of company activities.

Financial investigation is an in-depth examination, a detailed analysis of company’s financial and economic activities, directions towards a comprehensive investigation of the circumstances with an aim to detect illegal or malicious activities of the employees or third parties related to the invasion of company’s financial resources. In today’s business corporate fraud is widespread and its forms and motivations lead to different consequences for company activities.

Financial investigation needs to be carried out:

  • If the business owner does not have confidence in suppliers, buyers and partners;
  • If a business owner or a leader is suspicious about the employees committing fraud;
  • If a business owner is concerned about accounting manipulations;
  • If there are suspicions about the theft of assets or such instances have already been detected;
  • If the internal control system rules are not followed or if there are other suggestions on wheeler-dealer finance operations carried out by company employees.

Main tasks of financial investigation:

  • Conducting analytical and practical activities with an aim to research and obtain enough information about the threats of negative instances occurring or about the instances that have already occurred;
  • Identifying the amount of losses in case these instances occur;
  • Detecting the reasons for threats and risks.

Conducting a financial investigation

When conducting a financial investigation:

  • A consultant provides information and evidence collection for the implementation of an actual protection for financial interests of different parties;
  • A consultant identifies a reason for the occurrence of deviations and/or violations.

The main task and aim at the same time of financial investigation is to identify the cause and effect relationship between threats and the reasons leading to them.

The result of financial investigation helps to identify actual threats and risks, detect the reasons for what has happened, to take necessary measures and make leadership decisions.

Areas of financial investigations:

  • Investigation of financial distortions
Review of the analysis of fraud activities in the areas of finance, accounting and initial documentation.

  • IT-forensic
Electronic data analysis including the analysis of online communications and documents that include deleted e-mails and files that are located on hard drives, e-mail and file servers, the automation of large corporate data comparisons.

  • Corporate investigation
Internal risk identification using public and non-public information resources coming from client’s business contacts with their counterparties.

  • Prevention of dishonest activities
Risk assessment for dishonest activities and means of control with an aim to reduce them, assessment of internal control and fraud prevention system efficiency.

Results of financial investigations

Upon the completion of financial investigation, a consultant gets a result depending on the task that has been set for them and client’s requests. These results can be divided into the following categories:

1. Eliminating the consequences of dishonest activities meaning the preparation of expert conclusions in order to use them during court cases in the future.

2. During the investigation of fraud activities, a consultant:

  • Provides a report on the collected evidence and discovered incidents in order to press charges against a certain individual;
  • Calculates direct and, possibly, consequential losses from illegal activities with appropriate documental evidence;
  • Makes recommendations on taking necessary measures with an aim to reduce the risks of similar types of fraud activities occurring in the future.

3. Based on the results of assessing internal control systems and eliminating fraud activities, a consultant carries out an analysis of economic loss calculations and offers possible solutions for future activities to the business owner.

4. Based on the results of the analysis of the personnel management system, a consultant makes recommendations on conducting necessary activities that would prevent risks and on implementing a programme that would ensure imposition of penalties in the event of illegal activities.

5. If an independent assessment of partnership compliance is necessary, a consultant prepares a conclusion on fulfilment of obligations by all parties and a calculation of economic impacts, if the conditions are not fulfilled or fulfilled late.

Advantages of choosing Korpus Prava services when conducting a financial investigation:

  • Korpus Prava experts have experience in conducting all types of financial investigations;
  • Good value for money;
  • Free consultations during investigations (tax and legal advice).

Financial investigation services can be a part of other services, for instance, Due Diligence procedures or investigations with an aim to detect bankruptcy reasons.

Financial investigation is one of the most effective ways of minimising and preventing the risks of illegal and malicious activities.

Timely identification of threats by Korpus Prava specialists and detection of the reasons for their occurrence will allow you to make efficient decisions.