Artificial Intelligence for Audit, Forensic Accounting, and Valuation

CHAPTER 10Automated Procedures

AUDIT PROBLEMS ARE NOT confined to the United Kingdom and the United States. Recently, India saw its share of audit issues when Deloitte (Deloitte Haskins and Sells LLP) stepped down from the audit of Dewan Housing Finance Corporation, as the firm raised concerns about intercorporate deposits and problems with transparency. Deloitte's resignation was seen as a response to systemic problems that existed in the banking sector. Covering that development, the Financial Times reported that both Deloitte and KPMG affiliate BSR were facing criminal charges and a five‐year ban after a major finance group, Infrastructure Leasing & Financial Services, nearly collapsed (Findlay, 2019). Indian prosecutors alleged that the firms were complicit in conducting the fraud, but the firms have rejected such allegations. PricewaterhouseCoopers (PwC) was banned from auditing for two years when it failed to spot the $1.7 billion accounting fraud at Satyam Computer Services. In 2019, PwC resigned from Reliance Capital audit engagement and claimed that it was abiding by a regulation in India that requires an auditing firm to report reasonable suspicion of fraud to relevant authorities.

On June 13, 2019, in Mumbai, a spokesperson from Reliance Capital came out strong against PwC's resignation as statutory auditor and stated (taken from the media release of Reliance Capital (Reliance, 2019)):

• PwC's observations are completely baseless and unjustified.
• PwC has acted prematurely ...