Jaspreet Singh SinghJaspreet Singh asked 8 months ago

Sir,
1. Can non compliance with any provision also amount to fraud?
2. Sir, please confirm this
fraud committed by the employees/directors against the company-section 143(12)+para 3(x)
fraud committed by the company- para3(x) 
fraud committed by the third party against the company-reporting under SA 240
3.what shall be the role of statutory auditor incase management has discovered fraud? 
4. If the fraud has been detected during any other assignment(other than audit), what shall be the role of such professional performing such other assignment?

1 Answers
RaviRavi Staff answered 8 months ago
  1. Fraud means intentional omission or falsifying information to take unjustified advantage.  Doing fraud may involve non-compliance. Just any non-compliance cannot be called fraud. If it involves intentional taking unjustified benefit, then it can be termed as fraud.
  2. Fraud by officer or employee — Report in CARO + Sec 143(12)
    Fraud by Company — Report in CARO Only
    Fraud by third party on company — No reporting in CARO and No reporting Under Sec 143(12), If it is properly accounted, but it is significant then  we may put KAM / EMP / OMP to explain the impact.
  3. SA 240 is applicable to all audits corporates or  non-corporates 
  4. Get info check whether more euch frauds, se whether financial impact is properly accounted else report.
  5. Depends on engagement letter and scope but he should atleast inform management & TCWG as professional responsibility 

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