Practitioners’ Insights: Forensic Accounting—Don’t Lose Sight of Accounting Amid ESG

CFA Institute Live Webinars

Presentation

Recorded 23 November, 2023

Overview

Environmental, social, and governance (ESG) investing has gained attention over the past decade. Recently, India has taken a giant leap forward on ESG disclosures by introducing a new comprehensive reporting format: Business Responsibility and Sustainability Reporting. Investors are increasingly considering ESG nuances in their investment decisions. A bottom-up reading of several sustainability reports, however, suggests that more is said and less is done. One should learn to critically evaluate the newly adored stewardship mock-up. Accounting checks are objective and should precede the usual tick-box governance checks. A strong correlation exists between accounting quality and investment returns. In particular, over the past two years, small and mid-caps witnessed strong momentum. This requires caution.

Learning Outcomes

Evaluate case studies and examine the relationship between accounting quality and investment returns. Discuss how to use accounting checks with strong predictability power to spot red flags.
Gain an understanding of a strong board, including important measures to gauge governance quality and observations on audit quality in India as well as how to spot outliers.
Discuss key observations from the reading of sustainability reports of top 200 companies.

This is the archived version of a live webinar that took place on 23 November 2023

About the Speaker(s)

Vinit Powle has more than a decade of experience, including five years in equity research. Before joining Ambit, Powle worked with KPMG for five years, where he led assurance engagements across multiple sectors. Leveraging his knowledge and experience in the accounting and governance landscape in India, at Ambit, Powle now leads research related to forensic accounting; environmental, social, and governance (ESG) issues; and annual report analysis. Powle is a chartered accountant and holds a bachelor’s degree in accounts, economics, and financial management from Mumbai University.

Pankaj Sharma leads capital markets policy for CFA Institute in India. In his role, he is responsible for advocating policy positions on issues that affect Indian capital markets and stakeholders across a broad spectrum, including corporate governance issues; environmental, social, and governance (ESG) and sustainability topics; use of technology in capital markets; and demographic influences and local factors on markets. He is frequently quoted in media. Sharma has more than 20 years of experience in financial services. Before joining CFA Institute, Sharma was an award-winning and globally rated equity analyst covering a diverse set of sectors in India and abroad for global investment banks. He holds a master of business administration from FMS Delhi and a B Tech from Indian Institute of Technology, Kharagpur. Sharma is a published author on topics at the intersection of economy, society, and technology with globally recognised brands, including Bloomsbury and Routledge/Taylor & Francis.

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