FORENSIC ACCOUNTING

TERGORES HATI SDN BHDCASE STUDY

GROUP 1GROUP MEMBERS

SHAHFIZAN LHDNRUBHENDRANJKDMAL AZRI JKDMNASEER JKDMAZEEM KPDNKKROZILA JKDMTARIQ JKDM

PRESENTATION OUTLINES1. Analysis tools;

Vertical Analysis Horizontal Analysis Ratio Analysis

2. Graphs3. Fraud Issues4. Red Flags5. Conclusion

VERTICAL ANALYSIS

HORIZONTAL ANALYSIS

RATIO ANALYSIS

GRAPH

GRAPH

FRAUD ISSUES1. From 2008 to 2011 there is a trend of

declining revenue seems to show the following risk indicators.

1. Tax evasion2. Embezzlement of company funds.

2. Rising debt to assets ratio.1. Manipulation of asset cost.

3. A several year trend of declining gross, operating, net and free cash flow margins.

RED FLAGSdeclining revenue from 2008-

2011

RED FLAGS

Rising debt to asset ratio.

2011 2010 2009 2008

RED FLAGS A several year trend of

declining gross, operating, net and cash flow margins.

Cost of goods sold is higher than revenue.

COST is higher than

REVENUE

RED FLAGS GP Margin Profit margin

CASH FLOW ANALYSIS

2011

2010 2009 2008

CONCLUSIONBased on the financial fraud detection need to

establish forensic evidence on: Internal control of the organizationFinancial reportTrend of businessImproper disclosure Overriding controlCircumstances evidence

Based on the above we believed financial reporting fraud has occurred, therefore criminal proceeding has to be instituted.