2026, Vol. 9, Issue 1

Corporate fraud poses a serious challenge to financial transparency and corporate governance, particularly in emerging economies such as India. Conventional auditing mechanisms have often been found inadequate in detecting complex and intentional financial irregularities, leading to increased reliance on forensic accounting systems. The study adopts a descriptive and analytical research design based on secondary data sourced from prior empirical studies, regulatory reports, professional publications and corporate disclosures. It examines the evolution of forensic accounting, identifies key system components adopted by Indian corporates and analyses the challenges associated with their implementation. The findings indicate that forensic accounting in India has evolved from a litigation-oriented, reactive practice to an emerging governance and risk management tool, driven largely by regulatory interventions and high-profile corporate frauds. However, its adoption remains uneven across sectors and firm sizes. Forensic audits, data analytics, digital forensics, whistle-blower mechanisms and audit committee oversight emerge as the core components of forensic accounting systems. The study also identifies significant implementation challenges, including high costs, shortage of skilled professionals, technological limitations, organisational resistance and regulatory ambiguity. The study contributes to the growing literature on forensic accounting in emerging economies and highlights the need for stronger integration of forensic accounting within corporate governance frameworks.