Fraud Examination in Government-Aided Institutions:Empirical Analysis of Red Flags, Detection, and Prevention

Abstract

In India, Government-aided institutions receive large sums of grant funding but because they depend on independent auditors, there are serious monitoring flaws that result in rampant financial fraud. In order to examine the underlying causes of audit failures, this study adopts a unique mixed-methods approach to investigate these audit shortfalls by applying Donald R. Cressey's Fraud Triangle model. The research uncovers pervasive financial irregularities and confirms that a significant gap exists between grants allocated and legitimate institutional expenditures. More Importantly, the application of the Fraud Triangle identifies how a combination of pressures, opportunities and rationalizations that drives these fraudulent activities. The study concludes that a policy paradox exists where Governments expand grant allocations into this vulnerable system amplifying fraud risk & underscores the urgent need for systemic reforms to restore financial integrity in the education sector.