OPINION, NOT PROOF: EVIDENTIARY UNCERTAINTY IN INDIAN FORENSIC ACCOUNTING

Source abstract

India has become an intensive user of forensic accounting in fraud investigation, banking supervision, securities enforcement and insolvency resolution, yet the practice continues to operate without a dedicated, comprehensive statutory framework. Empirical and doctrinal scholarship on Indian corporate fraud has separately documented a weak and poorly coordinated regulatory system that binds only the membership of one accounting body; a systemically constrained statutory fraud-investigation agency; an audit regulator whose jurisdiction overlaps uncomfortably with that same professional body; and a persistent gap between the skills forensic accounting practice requires and what accounting curricula in India actually teach. This paper draws these separate strands together for the first time into a single account of regulatory fragmentation, organised around five recurring themes, namely, statutory basis, standard-setting authority, enforcement power, evidentiary status and licensing, applied across the principal regulatory touchpoints through which forensic audits are commissioned and relied upon in India. It corroborates the resulting picture through a reading of Supreme Court jurisprudence (2023–2026) that has had to supply procedural-fairness rules as the primary regulatory instruments left unaddressed. A comparative reading of the United Kingdom, the United States, Malaysia, and Nigeria identifies three governance archetypes and situates India as combining partial elements of each without having settled on any one. The paper closes with a set of tentative, policy-level directions for future reform.