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Deloitte India Forensic articles and whitepapers

Business Responsibility and Sustainability Report - What does it mean for the top 1,000 listed entities in India?

Disclosure requirements have leapfrogged globally in the last decade, holding companies accountable for their identification of Environment, Social and Governance (ESG) responsibilities and their transparent incorporation in annual disclosures.

In line with these global developments, the Securities and Exchange Board of India (SEBI), in its continued efforts to enhance disclosures on ESG standards, introduced new requirements for sustainability reporting by listed companies. The new reporting format named, Business Responsibility and Sustainability Report (BRSR), aims to establish links between the financial results of a business with its ESG performance. This can make it easier for regulators and investors, and allied stakeholders to obtain a fair estimate of overall business stability, growth and sustainability (hitherto based on financial disclosures alone). SEBI has mandated that the BRSR will be applicable to the top 1,000 listed entities (by market capitalisation) for reporting on a voluntary basis for FY2021–22 and on a mandatory basis from FY2022–23.
 

Integrated Risk Management and the 3 Lines Model

The recent revision of a recognized risk management model provides organizations a fresh reason to consider an enhanced approach to risk management leveraging digital capabilities.

The Institute of Internal Auditors (IIA) recently issued a modernized version of its traditional Three Lines of Defense model, which provides guidance to organizations on the coordination of risk management across the enterprise with a focus on the role of internal audit. Now called the Three Lines Model, it has been updated to reflect current practices in an increasingly complex business and risk landscape, offering evolving risk management guidance to organizations as they seek to achieve their strategic objectives.

Artificial Intelligence in cross-border forensic investigations

With continuously evolving business models, increased use of technology, and a changing regulatory landscape, fraud management is fraught with newer and more complex challenges than ever. These challenges are further exacerbated during cross-border investigations, where varied levels of standardisation, languages, local laws and regulations, along with specific cultural attributes bring additional complexities—mandating an investigation methodology standardisation and requiring tools for quick insights.

Pre-empt distress in loan accounts

In the recent years, banking sector in India has seen a rise in Non-performing Assets (NPAs) due to various reasons. The onset of the COVID-19 pandemic is expected to further negatively impact the NPA position in banks. Many businesses facing a zero-revenue situation might turn to banks for fresh loans or existing loan extensions. Considering the banking sector is already grappling with significant proportion of NPAs, banks need to exercise greater caution while monitoring or sanctioning new loans.

The Institute of Chartered Accountants of India’s (ICAI’s) Guidance note on ‘Early Signals of Fraud in Banking Sector’ also mentions continuous monitoring through tracking of certain early warning signals to pre-empt suspicious behaviours.

This document shares some perspectives on how banks can relook at their fraud risk management efforts to better manage their NPAs.

Are bad banks effective options to tackle non-performing assets arising out of COVID-19?

The extended lockdown to tackle the spread of COVID-19 has stalled economic activities, resulting in large-scale job losses. This has adversely affected the cash flow in businesses with an overarching impact on obligations including interest payments, loan repayments, and tax payments. There are existing non-performing assets (NPA) amounting to about 9.1 percent of the total assets (as of September 2019) Indian banks. At present, the government supposes the figure to double to 18–20 percent[1] by the end of the fiscal year, owing to the partial functioning of businesses. This fresh surge in NPAs has reinitiated discussions around bad banks as a strategy to deal with bad loans/NPAs.

Towards better anti-bribery and corruption compliance

Bribery and corruption remain a significant fraud risk for businesses across the world. Regulators across the world are trying to set comprehensive guidelines backed by stringent enforcement action to help organisations reduce instances of bribery and corruption.

Building trust in the vendor risk management ecosystem

Organisations’ procurement cycles are prone to fraud. Nearly a third of the respondents of the Deloitte India Corporate Fraud Perception Survey (Edition III, 2018), believe that procurement remains the most vulnerable to fraud risks. These risks, if not managed well, can have a disastrous impact on organisations’ reputation and financials. An increasing number of organisations use suppliers from various geographies with different complexities. This increases the likelihood of fraud and corruption in the procurement cycle and makes detection difficult.

Navigate to excellence with process mining

State-of-the-art business operations are largely process-driven, often supported by a variety of IT systems. Their ever-growing complexity poses tremendous challenges for process transparency, control, and efficiency.

Data discovery readiness assessment

Today’s business clime is that of risk and uncertainty. Even the slightest slip may lead to a possible litigation and jeopardise the reputation of your organisation. It therefore becomes crucial to be prepared adequately before a litigation, an investigation, or a regulatory request hits your doorstep. One of the most important steps towards this, is to proactively assess and structure your information governance processes. Effective preparation, a well articulated data map, and an integrated approach can help you make streamlined and timely decisions and protect your business.

Prevention of Sexual Harassment at the Workplace

The Bombay Chamber of Commerce and Industry organized a workshop titled “Effective Functioning of Internal Complaints Committee (ICC)” in Mumbai on 19 January 2018. The objective of the session was to help address the role of the ICC at the workplace under the Protection of Women against Sexual Harassment at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Anti-fraud and Compliance

Deloitte Forensic’s Anti-fraud and Compliance Preparedness eLearning Training Programs offer organizations the flexibility of customized modules on a web-based platform to create awareness about these issues within the organization. This, in turn, may help the organization comply with its regulatory requirements pertaining to fraud risk management, misconduct, and non-compliance.

Robotics – Will the final frontier be fraud free?

Robotic Process Automation (RPA) or intelligent automation (the combination of artificial intelligence and automation) is starting to change the way business is done.

Data breach scenario III

For a layperson, what do recent events of data breach and manipulation mean? Are there serious repercussions, especially given the fact that crores of people’s records have been compromised? The chances of an individual being impacted might thus be miniscule.

Deloitte’s Forensic practice in India presents a five part article series where fictitious cases help explain different data breach scenarios and their impact. These cases have been put together based on Deloitte Forensic’s extensive experience of working on some of the top fraud, misconduct and noncompliance investigations in India over the last decade.

Data breach scenario II

For a layperson, what do recent events of data breach and manipulation mean? Are there serious repercussions, especially given the fact that crores of people’s records have been compromised? The chances of an individual being impacted might thus be miniscule. Deloitte’s Forensic practice in India presents a five part article series where fictitious cases help explain different data breach scenarios and their impact. These cases have been put together based on Deloitte Forensic’s extensive experience of working on some of the top fraud, misconduct and noncompliance investigations in India over the last decade.

 

Data breach scenario I

For a layperson, what do recent events of data breach and manipulation mean? Are there serious repercussions, especially given the fact that crores of people’s records have been compromised? The chances of an individual being impacted might thus be miniscule.

Deloitte’s Forensic practice in India presents a five part article series where fictitious cases help explain different data breach scenarios and their impact. These cases have been put together based on Deloitte Forensic’s extensive experience of working on some of the top fraud, misconduct and noncompliance investigations in India over the last decade.

 

Considerations for building in-house fraud risk management teams: Expertise

Organizations understand the urgent need to build a strong fraud risk management framework to effectively prevent, detect, and respond to fraud. There are, of course, various considerations in putting together such a framework, including infrastructure and costs, experience and expertise, independence, and ancillary support, that need to be examined in order to address all of the organization’s needs.

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