Financial Integrity Diagnostic
Based on RBI Forensic Audit Patterns: This tool helps identify "Window Dressing" techniques where companies manipulate financials to stay within bank covenants. Answer the diagnostic questions below to generate a Risk Profile.
Window Dressing Detection Engine
This forensic utility identifies financial manipulation techniques used by entities to artificially inflate liquidity or net worth.
Diagnostic Checklist
Is there a significant buildup of inventory without a matching increase in sales?
Could indicate obsolete stock or inflated valuation to show a higher current ratio.
Do associate companies have different accounting year ending dates?
Commonly used to cycle the same capital through multiple entities to inflate group net worth.
Are there frequent transactions with associate companies that "wash out" or return to the parent?
Warning sign of circular trading to artificially boost turnover for higher bank limits.
Are any long-term loans actually repayable within 12 months (e.g., Associate loans)?
Misclassification of current liabilities as long-term artificially improves the current ratio.
Were any cash receipts for next year recorded in the current year?
Standard "Window Dressing" to exaggerate liquidity and profits.
Is there a steep rise in sales turnover with only marginal profit growth?
May indicate "paper sales" or aggressive pricing just to hit bank turnover targets.