Ryna Ferlatte heads the Forensic Services Unit of the World Bank’s Integrity Vice Presidency (INT). She has over 20 years of experience in forensic accounting, audit and corporate financial accounting, and reporting. In this interview, she provides a window into the field of forensic auditing and explains why it's so important to global anti-corruption efforts.
Why do we know so little about forensic auditing?
Big corporate fraud and corruption cases like Enron, Satyam, Siemens and others offer the basis of knowledge for what forensic auditors can contribute, but forensic accountants often work in the background of these large investigations. These cases show that the standard checks and balances, such as compliance, internal audit and external audit, are not always enough to prevent fraud and corruption. The role of an independent oversight function such as INT is critical and the World Bank has been a leader in including forensic auditing as part of the exercise of its audit and inspection rights of Bank-funded contracts. But this is not the only way forensics can add value.
Today, there is more recognition that forensics can be used not only to identify and quantify fraud and corruption losses, but also can serve as a deterrent and help reduce instances of such wrongdoing. And while forensic standards and tools are evolving globally, the results of forensic audits emphasize its value as an effective tool that can be also used proactively to cut financial losses in vulnerable sectors and high-risk projects.