Assess whether a referral to counsel is warranted (8819ab)

Situation

A sudden drop in days-sales-outstanding that looks too clean put management-bonus accrual workbook in front of audit-committee advisor in a distributor with offshore trading affiliates. This Forensic Accounting / Occupational Fraud close is a referral to counsel is warranted from management-bonus accrual workbook, and the live options are Remove access or reverse the item, Temporary compensating control, Approve a documented exception.

Decision

Audit-committee advisor in a distributor with offshore trading affiliates must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using management-bonus accrual workbook after a sudden drop in days-sales-outstanding that looks too clean.

Hypotheses to test

• Management-bonus accrual workbook reads as Remove access or reverse the item once a sudden drop in days-sales-outstanding that looks too clean is lined up to the same Forensic Accounting population.
• Management-bonus accrual workbook is closer to Temporary compensating control after a sudden drop in days-sales-outstanding that looks too clean; Remove access or reverse the item would over-claim this Occupational Fraud extract.
• Approve a documented exception is still live in management-bonus accrual workbook for audit-committee advisor in a distributor with offshore trading affiliates.
• Management-bonus accrual workbook is missing the fact audit-committee advisor needs after a sudden drop in days-sales-outstanding that looks too clean; stop this Forensic Accounting close.

Analysis required

• Separate a close-process miss from a qualitative SAB 99 issue in a distributor with offshore trading affiliates.
• Reconstruct vendor, journal, or inventory lines in management-bonus accrual workbook through the window opened by a sudden drop in days-sales-outstanding that looks too clean.
• Trace approval, SoD, and related-party links that management-bonus accrual workbook actually shows.
• For this Forensic Accounting Occupational Fraud file, read management-bonus accrual workbook against a sudden drop in days-sales-outstanding that looks too clean and write the one fact that would move a referral to counsel is warranted for audit-committee advisor.

Recommendation