Problem
The Head of Internal Audit of a global company headquartered in the Netherlands called you. His company learned of a revenue recognition fraud at their New England subsidiary. The information was identified by controls at the New England subsidiary. The CFO of the New England subsidiary "Michael" personally conducted a thorough investigation of the matter, and found that his subordinate "Jane" who was responsible for recording revenue, had misstated revenues to achieve higher performance compensation. Michael personally reviewed the documents. He asked Jane for her email password, and scanned her communications. Jane was angry and quit her job. Based on Michael's investigation, Jane acted alone and the total misstatement was only $150,000 in revenues, which was not material. Michael wants to put the matter to rest. The Head of Internal Audit cannot be on site, so he has asked you to "take a look at the investigation and see if is reliable."
You have not had a chance to talk with Jane or Michael, nor have you looked at any of the investigation work products or reporting. What concerns do you have? What should you advise the Head of Internal Audit?