One of the branches or specializations in the world of Accounting is Forensic Accounting. The job of a Forensic Accountant is to use their skills and knowledge for litigations and cases that require investigation. Forensic Accountants combine their accounting, auditing, and investigative skills to look for and uncover information regarding financial irregularities, fraudulent activity, and commercial negligence. The word “forensic” applies in this case as it means “suitable for use in court”, hence, its close relation with legislative processes.
A popular misconception about Forensic Accountants is that they spend most of the time investigating and uncovering criminal activity (e.g. embezzlement and corruption). However, while a Forensic Accountant’s work is closely tied to litigation processes, it’s not that common for them to work on actual criminal cases.
Forensic Accountants can be employed by specialized Accounting Firms, government agencies, and even companies looking to prevent financial scandals and improve their name and reputation. Other places where Forensic Accountants may find work are banks, police forces, and insurance companies.
Here’s a non-exhaustive list of common tasks Forensic Accountant are required to complete.
- Examining the company’s accounts and financial data:
- Analyzing the resources and liabilities of a company; and
- making sure financial records are accurate and consistent.
- Documenting financial reports:
- Reviewing clients’ financial books;
- analyzing profits and expenses;
- balancing financial books; and
- writing reports on the financial status of their clients.
- Managing financial records, systems, and budgets.
- Running financial audits and performing interviews to collect and verify information.
- Analyzing data from financial records, systems, and budgets:
- Reviewing financial books;
- finding discrepancies; and
- identifying important information.
- Carrying out forensic investigations:
- Tracing funds to their origins;
- identifying assets; and
- finding irregularities.
- Writing forensic reports to be used in court:
- Preparing analytical data;
- analyzing profits and expenses;
- finding discrepancies; and
- presenting findings as evidence in court.
- Preventing possible fraud cases by balancing a company’s books.
- Attending court.
- Collecting and analyzing financial data in spreadsheets.
- Performing audits and interviews to gather data.
- Finding discrepancies in the data.
- Documenting reports based on data findings.
- Preparing evidence to be used in court and presenting it.
- Providing expert testimony in court.
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- Excellent communication skills:
- Communicating clearly, both in writing and verbally, in order to effectively advise and interact with clients, employers, and court members;
- presenting findings of forensic investigations using the proper legal terminology;
- writing detailed and accurate accounting reports and being able to explain the results to clients, employers, and members of a court, using technical and non-technical language accordingly; and
- being able to work as part of a team.
- Highly detail-oriented:
- Analyzing financial receipts and detailed information regarding finances;
- analyzing long and complex financial books; and
- carefully and accurately entering data into forensic reports.
- Outstanding numeric and mathematical skills:
- Performing simple and complex calculations.
- Excellent organizational and time management skills:
- Working in several cases and handling different reports at the same time while meeting deadlines.
- Good analytical skills:
- Analyzing incomes and expenses to find possible discrepancies;
- having a methodical approach to analysis;
- analyzing budgets; and
- finding ways to avoid fraud embezzlement.
- High levels of integrity and honesty:
- Handling sensitive and confidential information.
Most entry-level jobs for aspiring Forensic Accountants are open to applicants with a wide variety of degrees. The most common degrees that employers look for in this field are Accounting, Economics, Business, and Mathematics. Previous work experience in the areas of Finance or Retail can also increase the chances for possible applicants. Although additional studies in the field of Accounting are not necessary for entry-level positions, further advancements in this career path will require a special certification.
In Canada, all Accounting activities are governed and regulated by the Chartered Professional Accountants of Canada (CPA Canada), an association looking to unify, regulate, and certify all Accountants in the country. They are the ones that offer certification programs in all provinces and territories for Accountants to become Chartered Professional Accountants with a specialization in the field of their choosing.
Most employers offer their new entries all the proper training they’re going to need by the hand of older and more experienced Forensic Accountants. However, Forensic Accounting Firms and other companies prefer to hire candidates that are working towards becoming a CPA or have already gone through the process. Obtaining a CPA certification can take up to 3 years of specialized courses and practice in the Accounting field. Furthermore, there’s the final evaluation applicants must pass in order to obtain the certificate. A certified CPA can apply to better and higher ranks within a firm as well as higher wages.
In recent years, many companies have chosen to include a Forensic Accountant in their staff in order to prevent possible scandals and cases of fraud and embezzlement.
Working hours for Forensic Accountants are usually the standard office hours. However, depending on the size of a case and possible deadlines set by court dates, extra hours of work can become common for Forensic Accountants. The job Forensic Accountants undertake can be arduous and demanding with high levels of stress and pressure. Applicants need to be flexible and adaptable with the hours they work. They also need to possess high levels of commitment and determination to go through extensive investigations.
When working for large companies or in cases involving big enterprises, it is common for Forensic Accountants to travel to their premises. Most of the time travelling is limited to a single city, but sometimes cases may need Forensic Accountants to travel abroad in order to conduct their investigations.