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Ensors Forensic Accountants

Forensics

Ensors are leading forensic accountants. Here they demonstrate their expertise, list case studies and Fiona Hotston Moore explains the growing rise of professional negligence claims against auditors, accountants and tax advisers


In today’s complex, technology-driven world, it's good to know you have experts on your side. We provide professional, objective analysis of relevant financial information to help you resolve disputes as quickly and cost effectively as possible.

By working closely with lawyers, insurers, arbitrators, insolvency practitioners, mediators, corporations and individuals, our highly experienced Forensic Accounting team provides authoritative advice on all kinds of litigation and investigations, including commercial disputes, civil and criminal cases, business valuations, professional negligence and personal injury claims.

With the potential for disputes to become protracted and costs to spiral out of control, our team is responsive and efficient, while maintaining meticulous attention to detail. They combine high-level accountancy expertise with extensive knowledge of current legislation and best practice in the fields of tax, insolvency and corporate finance. They are also acutely sensitive to the stresses and anxieties often experienced by those involved in civil or criminal disputes and are fully transparent, offering a flexible fee structure.

Members of our team are accredited with The Academy of Experts and NIFA (Network of Independent Accountants) and act as Expert Witnesses in civil and criminal matters and have experience of giving evidence in Court.

Areas of Expertise
• Commercial disputes including: breaches of contract; loss of profits and loss of earnings claims; intellectual property rights and royalty claims; cross-border disputes; warranty claims; partnership and shareholder disputes.

• Tax disputes including tax tribunals and litigation and National Crime Agency (NCA) investigations.

• Personal injury and insurance claims.

• Support for criminal investigations including: cases involving fraudulent trading; wrongful trading; false accounting; and employee and officer fraud. Services also include asset tracing & recovery reports; testimony for use in court; and fraud prevention reviews.

• Commercial and tax valuations including advice for divorce and family matters.

• Due diligence for sale and purchase agreements and post sale disputes including warranty claims.

• Professional negligence claims including auditor, accountant and financial advisers.

Case studies
Tax fraud
A tax payer who was under investigation by the National Crime Agency (NCA) for tax evasion engaged Ensors to assist. The nature of the case and the sums involved was such that HMRC had passed the matter to the NCA to resolve. The initial estimates of the potential liabilities for tax evaded amounted to in excess of £2m.

An analysis was carried out on a substantial amount of data covering five years, including 80 bank accounts, trading records and property transactions. A report was produced on the under declared tax liabilities and represented the client in the negotiations with the NCA. This case resulted in a final settlement of less than a quarter of the original assessments.

Employee fraud
Ensors were engaged by a substantial group to investigate a suspicion of employee fraud. While there was initially no suspicious transactions, the company had become aware of criminal proceedings against the employee in relation to a previous employment.

An investigation of the company financial records was undertaken including sample checks on banking transactions, cash requests and purchase invoices. Within a week, we identified a number of fraudulent transactions in excess of £100,000 and also identified failings in the banks processes in relation to the mandates. Ensors successfully provided evidence to assist in the recovery of monies from both the employee and the bank.

Professional negligence claim against tax advisers Ensors were engaged by the defendant to act as an expert witness in a claim for approximately £500,000 against the tax advisers by their clients in relation to a tax scheme.

The case related to transactions entered into nearly a decade earlier, Fiona Hotston Moore was able to draw from her own experience working as a tax adviser in relation to film finance in the relevant time. Fiona prepared a report to cover her opinion on how the tax legislation applied to the transactions anticipated and undertaken. Equally helpful, she was able to explain how the relevant practices and political environment in relation to film partnerships had changed over the last decade. Fiona provided a joint report with the other party’s expert and the matter was settled shortly thereafter.

Money laundering
Ensors were engaged to provide an expert report to assist the court in relation to criminal proceedings for substantial money laundering. The report was required to give an opinion on the extent of funds laundered through casinos and other means.

Ensors were able to review the records and provide an analysis of the transactions, it was suggested that the sums involved were substantially lower than the
sums initially estimated by the prosecution. We were then required to illustrate via diagrams and graphs to explain the movement of funds.

Auditor professional negligence
Ensors were engaged by the claimant to provide an expert report on whether the audit was in accordance with the standards of a reasonably competent auditor and to quantify the loss arising. In our report we identified substantial failings in the audit such that the financial statements contained a material misstatement and substantiating a resulting loss in excess of £10m.

Errors identified included:
• A failure to demonstrate appropriate professional scepticism, A failure to set and use an appropriate materiality level which then undermines the whole audit process;

• A failure to follow the firm's audit guidelines and manual;

• A failure to investigate errors arising in the sample during audit testing;

• A failure by the audit partner to investigate questions or review points raised by audit team members; and

• A failure to adequately audit the going concern assumption upon which financial statements are normally based.