The is difficult and Inflated sales were covered

The basis for external auditors to issue a clean audit opinion is when the auditor issue the audit report which determined that financial records and statements provided by the business is free of any misrepresentation and appropriately presented. The word “independent” is shown on the title of the audit report to show it had been prepared by a third party. Clean audit opinion is also known as unqualified opinion. This also indicate that financial records had followed the guidelines of the Generally Accepted Accounting Principles. In the article, B.Ramalinga Raju had confess to fabricating one billion cash which the fraudulent invoices had direct impact to the amount, as Satyam’s accounting receivables team could practice emergency generating of invoices, external auditor had found evidence stating about 75,000 of the Invoices created, 7,561 were fraudulent. The invoices seemed more reliable as it was stored in its original state, which will lead others into thinking that the data is reliable as manipulating the original invoice is difficult and Inflated sales were covered up by claiming that they had more workers working and money-making projects. Furthermore, document had been fabricated to show that money “earned” was reinvested. Satyam had claimed payment of the invoices had been made through New York branch of bank of Baroda however, the bank had stated that no such payment was made. The evidence stated documents that have direct impact on the figures of the balance sheets, fabrication of about one billion dollar cash. There was evidences of numbers of similar document found and same mistake do not occur many times. In conclusion, the evidence received by the external auditors seemed reliable to them because it was created from the IMS and that its figures tallied with other invoices. The external auditors, however, do not know about the fact that some of the invoices were generated without the multistep process and that some invoices were hidden as well. As the external auditors only received the ‘evidence’ that Satyam wanted them to see, they were fooled into issuing a clean audit opinion for Satyam.


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