Corporate frauds on rise in India- Survey

December 5, 2012

As per the findings of India Fraud Survey Report 2012 published by KPMG, around 75% surveyed corporate in India believed that the incidences of fraud were increasing. As per the report:

Decline of ethical values, weaker internal control system, reluctant managers for taking the decisive action were major reasons.
Mistake of senior management tasks by the audit committees, weak regulatory mechanisms major concern.
Sales, distribution and procurement are most susceptible areas of fraud.
Competition to surpass market expectations was the primary reason behind financial fraud
Fraud in financial statement was a primary concern
Absence of recognized fraud risk management system
In coming years, Computer-related and e-commerce frauds would become major concerns,
Around 75% frauds were committed by the employees

The important findings of the Survey are as follows:

63% say the desire to exceed market expectations is the main reason to commit financial fraud
81% say financial statement fraud is a major issue
41% say they do not have a formal fraud risk management framework
e-commerce & computer-related fraud to be a source of major concern in the coming years
75% all fraudulent activities, except Intellectual Property (IP) fraud were perpetrated by employees

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