| a) What is forensic accounting? | | | | accounting specialists are engaged in the public |
| Forensic accounting is the practice of utilizing | | | | practice of forensic examination, others work in |
| accounting, auditing, and investigative skills to | | | | private industry for such entities as banks and |
| assist in legal matters. It encompasses 2 main | | | | insurance companies or governmental entities |
| areas, litigation support, investigation, and dispute | | | | such as sheriff and police departments, the |
| resolution. Litigation support represents the factual | | | | Federal Bureau of Investigation (FBI), and the |
| presentation of economic issues related to | | | | Internal Revenue Service (IRS). |
| existing or pending litigation. In this capacity, the | | | | The occupational fraud committed by employees |
| forensic accounting professional quantifies | | | | usually involves the theft of assets. |
| damages sustained by parties involved in legal | | | | Embezzlement has been the most often |
| disputes and can assist in resolving disputes, even | | | | committed fraud for the last 30 years. Employees |
| before they reach the courtroom. If a dispute | | | | may be involved in kickback schemes, identity |
| reaches the courtroom, the forensic accountant | | | | theft, or conversion of corporate assets for |
| may testify as an expert witness. | | | | personal use. The forensic accountant couples |
| Investigation is the act of determining whether | | | | observation of the suspected employees with |
| criminal matters such as employee theft, | | | | physical examination of assets, invigilation, |
| securities fraud (including falsification of financial | | | | inspection of documents, and interviews of those |
| statements), identity theft, and insurance fraud | | | | involved. Experience on these types of |
| have occurred. As part of the forensic | | | | engagements enables the forensic accountant to |
| accountant's work, he or she may recommend | | | | offer suggestions as to internal controls that |
| actions that can be taken to minimize future risk | | | | owners could implement to reduce the likelihood |
| of loss. Investigation may also occur in civil | | | | of fraud. |
| matters. For example, the forensic accountant | | | | At times, the forensic accountant may be hired |
| may search for hidden assets in divorce cases. | | | | by attorneys to investigate the financial trail of |
| Forensic accounting involves looking beyond the | | | | persons suspected of engaging in criminal activity. |
| numbers and grasping the substance of situations. | | | | Information provided by the forensic accountant |
| It's more than accounting...more than detective | | | | may be the most effective way of obtaining |
| work...it's a combination that will be in demand for | | | | convictions. The forensic accountant may also be |
| as long as human nature exists. Who wouldn't | | | | engaged by bankruptcy court when submitted |
| want a career that offers such stability, | | | | financial information is suspect or if employees |
| excitement, and financial rewards? | | | | (including managers) are suspected of taking |
| In short, forensic accounting requires the most | | | | assets. |
| important quality a person can possess: the ability | | | | Opportunities for qualified forensic accounting |
| to think. Far from being an ability that is specific | | | | professionals abound in private companies. CEOs |
| to success in any particular field, developing the | | | | must now certify that their financial statements |
| ability to think enhances a person's chances of | | | | are faithful representations of the financial position |
| success in life, thus increasing a person's worth in | | | | and results of operations of their companies and |
| today's society. Why not consider becoming a | | | | rely more heavily on internal controls to detect |
| forensic accountant on the Forensic Accounting | | | | any misstatement that would otherwise be |
| Masters Degree link on the left-hand navigation | | | | contained in these financials. |
| bar.b) Who uses forensic accountants? | | | | In addition to these activities, forensic accountants |
| Forensic accounting financial investigative | | | | may be asked to determine the amount of the |
| specialists work with financial information for the | | | | loss sustained by victims, testify in court as an |
| purpose of conveying complicated issues in a | | | | expert witness and assist in the preparation of |
| manner that others can easily understand. While | | | | visual aids and written summaries for use in court. |
| some forensic accountants and forensic | | | | |