what necessitates a forensic audit 
in a forensic audit an auditor would be on the lookout forasset misappropriation is the most prevalent form of fraud examples include misappropriating cash submitting falsified invoices making payments to non existent suppliers or employees misusing assets like company equipment and stealing company inventory a company can get into this type of fraud to try to show that its financial performance is better than it is the goal of presenting fraudulent numbers may be to improve liquidity ensure that c level executives continue to receive bonuses or cope with the pressure to perform example of a forensic audit caselet s say that a fictional computer manufacturer wysikids on the recommendation of its chief financial officer cfo entered into a contract with smart chips inc to supply wysikids with processors however when the contract was signed smart chips was not authorized to conduct business because its license had been indefinitely revoked based on certain irregularities in a recent internal revenue service irs filing wysikids cfo knew that smart chips license was suspended yet still suggested that their company sign on with smart chips as they were secretly receiving compensation from smart chips for doing so the fictional example of fraud depicted above could be uncovered by investigating the interpersonal relationships involved and exposing a conflict of interest 