Forensic accounting has been around for many years. With the spotlight on accounting due to high profile scandals such as the Enron debacle, the market for forensic accountants has increased. The increase in white collar crimes due to the economic downturn also has forensic accounting in high demand. These accountants assist in investigating financial, auditing and business related issues and require specialized training. Forensic accountants are retained by lawyers, police forces, insurance companies, banks, and the business community. Government agencies employ forensic accountants as well. Accounting positions at the FBI date back to the 1970s and around 15 percent of ...view middle of the document...
The analytical ability of the forensic accountant helps them provide more than simply auditing skills or problem-solving skills. The amount of data that has to be analyzed can sometimes be voluminous and the forensic accountant must be able to make decisions based on available information. When a person is analytical they can look for inconsistencies or pick apart a problem and come up with at solution. A forensic accountant has to look beyond the numbers and grasp the substance of the situation. They must pay attention to the smallest detail and thoroughly analyze the data (Bhasin, 2007). Certainly that is the goal of the business or government entity that hires the forensic accountant.
A forensic accountant must also be an effective oral and written communicator. Quite often the need to represent verbally a position in a court of law is necessary. The preparation of reports or documentation for review requires good written communications skills. Forensic accountants may also conduct interviews with the accused or involved parties to get individual stores about the irregularities.
A forensic accountant must have investigative abilities. This means they have to be intuitive and think like the perpetrator of a crime would. A healthy dose of skepticism needs to be present when looking at records for inconsistencies. A typical investigative accounting assignment would be an investigation of employee theft. Other examples include securities fraud, insurance fraud, kickbacks, and proceeds of crime investigations.
The forensic accountant must also have good auditing skills. Of all the areas of accounting, forensic accounting most resembles auditing, especially when it comes to fraud examinations. Auditing can be divided into internal and external auditing. External auditors are not employees of the company, they are auditors. Investigative services of the forensic accountant include the role of fraud auditor. These are services where those knowledgeable in accounting detect, prevent, and control fraud, defalcation, and misrepresentation (Hopwood,Young, Leiner, 2012).
Describe the role of a forensic accountant within a courtroom environment.
The word forensic means relating to the application of scientific knowledge to a legal problem or usable in a court of law (Freeman, 2008). Therefore, forensic accountants may also assist in legal proceedings, including testifying in court and preparing visual aids to support trial evidence. A forensic accountant will have to review documentation to form an initial assessment of the case and identify the areas of loss. They also assist with the examination for discovery including the formulation of questions to be asked regarding the financial evidence. They review the opposing expert’s damages report and assist with settlement discussions and negations. Attendance at a trial to hear the testimony of the opposing expert or to provide assistance with cross-examination is also where...