Local Case 3

Overview and Summary:

APBS is the wholly owned subsidiary of Asia Pacific Breweries  Ltd (“APBL”) which is listed on the Singapore Exchange.

The Finance Manager of APBS obtained credit and loan facilities from four different foreign banks by forging various documents, including certified extracts of directors’ resolutions.

The resolutions purportedly authorised him to operate the bank accounts on behalf of APBS as a sole signatory.

Several withdrawals from the loan and credit facilities were made and the monies used to finance his gambling activities and service his personal loans.

The four banks were collectively cheated of a total of S$117.1 million. 

The Commercial Affairs Department managed to secure the recovery of about S$34.8 million, from property seized in the course of investigations as well as voluntary remittances made by the Finance Manager from his oversea bank accounts.

Issues Arising:

Considerations by Auditors:

~ Professional Competence and Due Care?  For example, could the auditors have adopted a greater degree of professional skepticism and be more alive to the possibility of fraud?

~ Reliance on management representation? For example, could the auditors have assessed the integrity of top management for fraud ?

~ The “perfect” crime ?