FOR2607
Assignment 2 Semester 1 2025
Unique #:629888
Due Date: 21 April 2025
Detailed solutions, explanations, workings
and references.
+27 81 278 3372
, QUESTION 1
Financial investigation refers to the process of gathering, verifying, analysing,
and interpreting financial data to uncover hidden income, detect fraud, or support
criminal investigations. It is mainly used by forensic or criminal investigators to
trace the flow of money, determine unexplained wealth, and assess whether
individuals are living beyond their known means. This investigation includes
reviewing bank statements, accounting records, assets, liabilities, and lifestyle
habits. It helps uncover illicit activities, especially where direct evidence is lacking,
by creating a financial profile of the suspect.
Unlike forensic auditing or accounting, which may involve complex financial
computations, financial investigation focuses on understanding and proving
financial behaviour relevant to suspected crimes. It must be done legally, often
requiring court orders or subpoenas.
QUESTION 2
Reasons for Financial Investigation and Practical Examples
Financial investigations are essential tools used by forensic and criminal
investigators to uncover, prevent, or respond to fraud and corruption within the
public service and other sectors. The purpose of such investigations is to gather
and analyse financial information related to a suspect or subject under
investigation. Below are key reasons for conducting financial investigations,
supported by practical examples:
1. To confirm suspicions of living beyond known means
Investigators often look for signs that an individual’s lifestyle exceeds their
legal income. For example, a junior official earning R15 000 per month
suddenly purchases a luxury car or property worth millions. This
unexplained wealth raises red flags and may indicate bribery or misuse of
public funds.
2. To confirm income from undeclared sources
An employee might have known earnings, but evidence suggests they are
receiving additional money. For instance, a procurement officer in a
government department may receive regular payments from a supplier’s
company, hidden through multiple transactions or offshore accounts.
Varsity Cube 2025 +27 81 278 3372
Assignment 2 Semester 1 2025
Unique #:629888
Due Date: 21 April 2025
Detailed solutions, explanations, workings
and references.
+27 81 278 3372
, QUESTION 1
Financial investigation refers to the process of gathering, verifying, analysing,
and interpreting financial data to uncover hidden income, detect fraud, or support
criminal investigations. It is mainly used by forensic or criminal investigators to
trace the flow of money, determine unexplained wealth, and assess whether
individuals are living beyond their known means. This investigation includes
reviewing bank statements, accounting records, assets, liabilities, and lifestyle
habits. It helps uncover illicit activities, especially where direct evidence is lacking,
by creating a financial profile of the suspect.
Unlike forensic auditing or accounting, which may involve complex financial
computations, financial investigation focuses on understanding and proving
financial behaviour relevant to suspected crimes. It must be done legally, often
requiring court orders or subpoenas.
QUESTION 2
Reasons for Financial Investigation and Practical Examples
Financial investigations are essential tools used by forensic and criminal
investigators to uncover, prevent, or respond to fraud and corruption within the
public service and other sectors. The purpose of such investigations is to gather
and analyse financial information related to a suspect or subject under
investigation. Below are key reasons for conducting financial investigations,
supported by practical examples:
1. To confirm suspicions of living beyond known means
Investigators often look for signs that an individual’s lifestyle exceeds their
legal income. For example, a junior official earning R15 000 per month
suddenly purchases a luxury car or property worth millions. This
unexplained wealth raises red flags and may indicate bribery or misuse of
public funds.
2. To confirm income from undeclared sources
An employee might have known earnings, but evidence suggests they are
receiving additional money. For instance, a procurement officer in a
government department may receive regular payments from a supplier’s
company, hidden through multiple transactions or offshore accounts.
Varsity Cube 2025 +27 81 278 3372
