New Delhi, May 21 -- Forensic audits have gained significance in today's world of business as they serve as a useful tool for commercial lenders to investigate fraud by borrowers and/or identify other deep-seated financial irregularities. Forensic auditors are also employed by resolution professionals to report on preferential, undervalued, fraudulent and extortionate ('PUFE') transactions for adjudication under India's Insolvency and Bankruptcy Code (IBC).

While there is no single universal definition, several globally recognized organizations have provided widely accepted definitions (and norms) of forensic auditing.

A forensic audit can broadly be described as a specialized exercise that blends accounting, auditing and investigative ...