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Misappropriation of funds

I.V. Chandra Sekhar (Asst. Manager) (172 Points)

27 August 2011

I need one clarification on the below issue. Please clarify.

One of my client employee is entered into contract with a Travel co. for hiring vehicle on monthly basis without proper approvals from the top management. Agreement shall be approved by himself with the Travel co. with out intimating to the his immediate superriors. Monthly rent would be Rs.30,000/-.

Is it a case of Fraud by such employee and considered as Misappropriation of Funds

Regards

Chandrasekhar

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2 Replies

CS Bijoy (Expert) (6394 Points)
Replied 02 September 2011

If the payment is required to be done by the Management than discussion is required otherwise ependiture will not be reimbersed.....

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Akhil Sharma (Service) (141 Points)
Replied 02 September 2011

First of all the transaction in question should be put up to the management for ratification. Once ratified, the transaction will be regular. In case not ratified, then the company should pay to the travel company for the lapsed period (since one of his employee entered into the agreement with travel company) and discontinue with the agreement with immediate effect. The company may be taking disciplinary action against the erring employee.