The word forensic in the accounting career shows the relation and use of financial evidence to legal problems. Forensic accounting proof is oriented to a civil or criminal court of law. Additionally, with its inclination to courts of law, the job done by forensic accounting professionals is subject to public examination of the matter and goes to trial. The participation of the forensic accountant is nearly always reactive; this differentiates forensic accountants from fraud assessors who tend to actively participate in prevention and detection in a regulatory or corporate environment. Forensic issues include inquiries and rumors arising in corporate investigations, and reports of a claim arising in civil litigations. A forensic accountant’s investigative findings will impact a company or individual in terms of their liberty or in terms of monetary loss or award. The forensic accounting professional draws on different resources to get relevant financial proof. Ideally, forensic accounting experts allow two parties to more efficiently and quickly resolve a rumor, inquiry, complaint, or statement of claim, or at least to lower the monetary element as an aspect of ongoing debate.
When is a forensic accountant needed?
You’ll need a forensic accountant in cases of:
Fraud, robbery or other defalcation
Disputes (partner, shareholder, dissent or oppression from an act of the entity, alleged violation of contract, purported fraudulent inducement, and more)
Financial statement misrepresentations
Bankruptcy, reorganization, and insolvency
Corporate investigations
Economic damages
Family law (divorce)
Insurance claims
Tax fraud
Money laundering
How to choose a good forensic accountant
Finding the right forensic accountant isn’t easy, especially if you need one who can testify in court. However, research will greatly help. Here are things to consider when choosing a forensic accountant:
Experience. Ideally, choose a forensic accountant with the appropriate skill set for your specific case. For instance, if you need an accountant to prepare a financial report for a criminal trial, choose one who has handled such cases before. Remember that there are several areas where you might require forensic help. In some instances, you might require a professional with very particular industry experience including valuing a construction company.
Credibility. To be a helpful expert witness, your accountant must have the appropriate credentials. A view of a practitioner in a specific area will carry more weight compared to one offered by a witness without experience in the area being litigated. Qualifications and training are also vital in determining the professional’s credibility. Most forensic accountants have affiliations with professional bodies.
Personal skills. Consider the personal characteristics of potential forensic accountants. This means you only consider an accountant you feel you and your lawyer can work closely with. Your forensic accountant should be communicative, approachable, and tactful.
Court appearance. Generally speaking, a veteran forensic accountant should be qualified in giving oral proof in court. It’s important of they’re already experienced in the witness box. Nonetheless, some accountants aren’t used to giving evidence. For instance, they may work on criminal cases where findings often get argued out of court. Be open-minded when it comes to such instances.
Cost. Forensic accountants don’t cost the same. For example, hiring a forensic accountant from a big practice could cost more than a smaller agency. In forensic accounting, you get what you pay for. Thus, consider forensic accountants who can give the attention you require for your case and compare their prices.