Case summary

Bruce Wayne, Sales Director of Stark Enterprises sent an email to the accounting firm where your group works as a forensic team.

An extract of the email is provided below:

I have some concerns about my sales manager in Darwin City, Toby Crimson. Toby has been with the company for over ten years and had originally joined as a sales officer. He has gradually made his way up the ladder with his diligent work and efforts. For the last three years he has also won the Best Sales Manager award from the company for having the highest amount of sales in the year.

Recently, a whistleblower has made allegations that Toby has been inflating the revenue of the unit in Darwin and is also stealing from the company. He alleged that Toby was recording fictitious revenue in the system and showing returns as expenses instead of sales returns. In addition, it was alleged that the bad debt write-offs in the Darwin City unit have significantly increased over the last two years.

While Toby has always been a trusted employee in the organisation, I am reluctant to pass off the whistleblower accusations as the act of a jealous employee. Toby has recently purchased a new house in an expensive neighbourhood in Darwin and has also purchased a new Tesla SUV.

I was wondering if your forensic team might be able to initiate a preliminary investigation into the matter to check if the whistleblower allegations are worth examining further.

Question 1 (5 marks)

Discuss the preliminary analyses that you would undertake in order to determine whether a formal investigation needs to be launched against Toby Crimson. It should include the scientific methods and forensic analytical tools or approaches you would use to reach your decision.

Question 2 (10 marks)

Upon reviewing your initial thoughts on Question 1, Bruce Wayne now requests you to launch a formal investigation.

Prepare an investigation plan using the headings below. Your investigation plan must address how you will manage the investigation to address the allegations of the potential employee-related fraud.

Investigation plan

• Investigation overview

• Scope and purpose

• Resources

• Timeframe

• Affected persons

• Risk management

• Information-gathering tasks

Question 3 (10 marks)

Discuss the different ways in which you will analyse the evidence using the broad analyses methods.

Describe the data mining techniques that you will apply to the information gathered and how those techniques will help you reach a decision regarding the allegations against Toby Crimson.

Question 4 (5 marks)

One of your newly recruited accountants, Layla, was sent to the Darwin office under the guise of a newly hired Management Trainee at Stark Enterprises. One day while returning from her lunch break, she found Tobys office empty. She went into the office to have a look and saw the laptop password and username on a post-it on Tobys desk. Layla quickly opened the laptop and copied documents from the C-drive onto her pen drive. She also managed to copy the emails on Tobys outlook onto her pen drive. Layla then leaves the office without anyone noticing.

Critically review the above facts and identify and examine all issues relevant to a consideration of whether there is any failure to comply with the standards applicable to forensic digital practice including chain of custody. Clearly specify the impact each issue may have on both the investigation and potential litigation and explain what should have been done to counter or mitigate the identified risks.

Question 5 (10 marks)

Discuss the emerging role and importance of digital forensics in accounting fraud investigation. Students should extensively refer to at least 4 peer reviewed journal articles to provide a well-rounded answer to the question.