Red Flags Compendium Practical Case Studies in Forensic Accounting & Corporate Fraud Investigation

Description Get the latest “Red Flags Compendium: Practical Case Studies in Forensic Accounting & Corporate Fraud Investigation” (1st Edition, 2025) by CA Kamal Garg, published by Bharat Publishers. This 568-page guide provides expert insights into forensic accounting and fraud detection. Flat 25% discount for a limited time with free shipping. ISBN: 978-93-4808-089-9. Order now! Chapter Number Description Page Number Preface 7 Detailed Contents 13 Chapter 1 Red Flags in Forensic Accounting and Investigation – An Introduction 1 Chapter 2 Material Business Changes 4 Chapter 3 Scale of Operations of a Company 8 Chapter 4 Complex Transaction Structures 12 Chapter 5 Predominance of Cash Transactions 16 Chapter 6 Registered Office of the Company 20 Chapter 7 Foreign Entity Connections and Potential Non-Compliance with FEMA 24 Chapter 8 Team Competency and Presence for Financial as well as Operations related matters 29 Chapter 9 Director Disqualification under Section 164(2) of the Companies Act, 2013 33 Chapter 10 Director Disqualification Due to Non-Filing of Financial Statements by Connected Entities 38 Chapter 11 Frequent Changes in Directors and Key Managerial Personnel 44 Chapter 12 Name Sake Directors 49 Chapter 13 Frequent Changes in Auditors and Auditor Independence 54 Chapter 14 Large Number of Related or Connected Entities 60 Chapter 15 Materially Adverse Information Identified through Public Domain Searches 65 Chapter 16 Promoters and Connected Entities Marked as Wilful Defaulters by Banks and Financial Institutions 70 Chapter 17 Corporate and Bank Guarantees Issued to Related Parties and Third Parties 75 Chapter 18 Unconfirmed Balances of Debtors, Creditors, Loans, and Advances 80 Chapter 19 High-Value Receipts and Payments during the Look-Back Period 85 Chapter 20 Legal and Professional Fees as a Potential Red Flag Indicator 90 Chapter 21 Kickbacks in Procurement Contracts 95 Chapter 22 Discrepancies Between Claims and Asset Values of the Corporate Debtor 100 Chapter 23 Non-Maintenance and Loss of Books and Records 105 Chapter 24 Weak Accounting Systems and Internal Controls 110 Chapter 25 Non-Registration and Non-Filing of GST/IT Returns 115 Chapter 26 Material Arbitration Proceedings 120 Chapter 27 Clean Audit Reports and the Need for an Avoidance Review 125 Chapter 28 Assets Featuring in the Balance Sheet without Proper Title 130 Chapter 29 Frequent Changes in Accounting Policies 134 Chapter 30 Incomplete Board Reports not in Line with the Companies Act, 2013 140 Chapter 31 Assets in Transit or Not Cleared from Port for a Significant Period of Time 145 Chapter 32 Assets Used by Other Entities on a Free of Cost or Lower-than-Market Charge Basis 150 Chapter 33 Significant Aging of Capital Work in Progress 155 Chapter 34 Significant Revaluation Reserves in the Balance Sheet 160 Chapter 35 Sale and Leaseback Transactions of Assets Pledged in Favor of Lenders 165 Chapter 36 Unauthorized Creation of Security Interests 170 Chapter 37 Assets Used for Personal Purposes of Promoters with Costs Borne by the Company 175 Chapter 38 Large Undervalued Asset Sales without Valuation Reports or Competitive Sale Process 180 Chapter 39 Incorporation of Special Purpose Vehicles (SPVs) and Transfer of Funds without Underlying Business Purpose 185 Chapter 40 Significant Investments in Partnership Firms and Other Unincorporated Entities 190 Chapter 41 Indian Special Purpose Vehicle (SPV) Subject to Strike Off and Loss of Trail of Funds 195 Chapter 42 Foreign Special Purpose Vehicle (SPV) Closed without Notice to Lenders and Loss of Fund Traceability 200 Chapter 43 Creation of Assets Abroad and in Related Entities 205 Chapter 44 Sale or Transfer of Key Revenue-Earning Business Divisions 210 Chapter 45 Shares of Investee Entities Purchased as Investments at Exorbitant or Unjustified Premiums 215 Chapter 46 No Returns on Investments in Terms of Dividends or Refund of Capital Even after Long Periods 221 Chapter 47 Large Value Investments Extinguished or Written off and Recorded as Losses without Proper Rationale, Leading to Erosion of Net Worth 226 Chapter 48 Shareholding Dilution by Fraudulent and Collusive Rights Issue Process and Relinquishments in Investee Companies 232 Chapter 49 Variances Between Stock Reporting to Lenders and Books of Accounts 238 Chapter 50 Sale of Inventory Other than in the Normal Course of Business 243 Chapter 51 Large Sales Returns to Certain Operational Creditors to Enable Preferential Payments for Current Transactions in the Ordinary Course of Business 249 Chapter 52 Inflated Stock and Book Debts Reporting without Underlying Inventory 255 Chapter 53 Customer Master Data is Not Maintained Properly and is Incomplete 260 Chapter 54 Fraudulent Accounting and Reporting of Sales and Inflation of Receivables 264 Chapter 55 High Value Discounts Offered to Some Customers and Not to Others 269 Chapter 56 Collections Routed Through Non-Authorized Bank Accounts or Received in Cash 274 Chapter 57 Customer Payments are Made Directly to Vendors/ Promoters and Receivable Balances are Not Reconciled 279 Chapter 58 Significant Aging of Receivables Balances 284 Chapter 59 Assignment of Receivables to Third Parties/Related Parties 289 Chapter 60 Large Receivables Extinguished/Written off and Recorded as Losses without Proper Rationale/Legal Efforts and Eroding the Net Worth 294 Chapter 61 Fictitious Bank Receipts (In Bank Book but Not in Bank Statements) 299 Chapter 62 Sudden Increase in Unbilled Revenue 304 Chapter 63 Receivables Written off on the Basis of Arbitral Awards 304 Chapter 64 Audit Qualifications on Revenue Recognition, Inability to Obtain Balance Confirmations 314 Chapter 65 Inflated Book Debts Reporting to Bankers Not Reconciled to Books of Accounts 319 Chapter 66 Presence of a High Number of Bank Accounts and Inter-Se Movement of Funds 324 Chapter 67 Diversion of Funds to Parties Other than Normal Business Payees 329 Chapter 68 Round Tripping of Funds Between Various Cash Credit Accounts Held with Different Bankers to Enhance Debit and Credit Summations of Bank Accounts 334 Chapter 69 Fund Movements Not through Designated Consortium Accounts 339 Chapter 70 Loans and Advances given without any Agreements and Legal Recourse 344 Chapter 71 Loans to Directors/Entities for No Business Purpose and Includes Related/Connected Entities 349 Chapter 72 Significant Aging of Loan Balances 354 Chapter 73 Loans and Advances on an Interest-Free Basis Although Interest is Paid by the Company 359 Chapter 74 Large Value Loans and Advances Written off without any Legal Recourse/Attempts to Collect and Eroding the Net Worth 364 Chapter 75 Loans and Advances Outstanding in Entities which are under “Strike-off” as per MCA Records and No Proceedings are Stated as Possible 369 Chapter 76 Share Capital Not Received by Bank Funds Process but by Adjustment Entries 374 Chapter 77 Return of Allotment Not Filed or Filed with Wrong Facts and Figures 379 Chapter 78 Exorbitant Share Premium from Investor Companies Not through Bank Sources and/or Diverted Back later 364 Chapter 79 Shareholding in the CD is Fictitious — the Investor-Shareholders have themselves Extinguished the Investments in their Balance Sheets 389 Chapter 80 Company Funds have been used to Purchase Shares of the Company by Directors 394 Chapter 81 Loans Recorded by Mere Book Entries without Corresponding Bank Inflows — Preference/ Fraudulent 399 Chapter 82 Round Tripping Loans Received, diverted to Other Group/Connected Entities without any Business Purpose — Diversion of Funds 404 Chapter 83 Loans taken without No Objection from Existing Lenders and Security Interest Created thereon 409 Chapter 84 Unsecured Loan becomes a Secured Loan without New Value 414 Chapter 85 Loans Stated as Received in Cash 419 Chapter 86 Certain Loans Settled in Priority over some Other Loans 423 Chapter 87 Loans Received at Exorbitant Rates of Interest or Security Created and Purchases on Credit at Exorbitant Prices 428 Chapter 88 Loan Agreement Stated as Secured Loan by Unregistered Memorandum of Deposit of Title Deed (MoDTD) and Ante-Dated Transactions 432 Chapter 89 Where Loans have been Recognized due to Invocation of Bank Guarantees (BGs), where such BGs did Not Reflect Genuine Business Transactions 437 Chapter 90 Security Interests and Claims Recognized on Basis of Award by Court or Tribunal 442 Chapter 91 Conversion of Unsecured Loan to Secured Loans in Order to Defraud other Secured Creditors Impacting the Waterfall Mechanism under Section 53 of the Insolvency and Bankruptcy Codel 447 Chapter 92 Fictitious Purchases of Goods and Services and Consequent Liabilities and Losses 452 Chapter 93 Transactions Especially with Related Parties Not on an Arms-Length Basis 457 Chapter 94 Significant Aging of Payables Balances 462 Chapter 95 High Value Sole Selling or Purchase Agents and/or Related Partiesl 467 Chapter 96 Creditors Settled Directly by Customers but still Showing as Outstanding both for Receivables and Payables 472 Chapter 97 LCs Issued for Local Trade Related Party Transactions without Underlying Trade Transactions 477 Chapter 98 Significant Reduction in the Stake of Promoter/ Director or Increase in the Encumbered Shares of Promoter/Director 482 Chapter 99 Resignation of the Key Personnel and Frequent Changes in the Management 487 Chapter 100 Increase in Borrowings, Despite Huge Cash and Cash Equivalents in the Borrower’s Balance Sheet 492 Chapter 101 Claims Not Acknowledged as Debt High 497 Chapter 102 Large Number of Transactions with Inter-Connected Companies and large Outstanding from such Companies 502 Chapter 103 Fictitious Bank Receipts in Bank Books 506 Chapter 104 Exorbitant Share Premium from Investor Companies 509 Chapter 105 Share Capital Contributions Not through Bank Channels 511 Chapter 106 Inflated Stock and Book Debts Reporting 513 Chapter 107 Hidden Dangers in Corporate Financial Statements — A Comprehensive Analysis of Red Flags 515 Chapter 108 Corporate Social Responsibility (CSR) Fraud and Forensic Investigation — A Comprehensive Analysis 530