Forensic accountants examine financial information in legal cases. They must possess a keen understanding of business processes and financial information systems. In addition, they must be proficient in gathering, recording, and storing any information derived from the investigation. Knowledge of accounting procedures and standards is a must, as are strong observational skills. Forensic accountants should have knowledge of the litigation process as well.
Forensic accountants, though not directly involved in crime scene investigation, do their fair share of sleuthing. Forensic accounting carefully examines the monetary effects of the crime, as well as the finances of every party involved. This is especially important in cases of money laundering, fraud, identity theft, insider trading, graft, and robbery. Any discrepancies in the accounting done by either party will be noted and questioned by forensic accounting experts. The forensic accountant may provide expert testimony in court based on his investigation.
Forensic accounting plays a role in the resolution of a myriad of cases. One of the most common applications of forensic accounting is in the resolution of an insurance claim. Before a settlement is released by the insurance provider, a forensic auditor may check the veracity of the claim. Personal injury disputes filed by employees and other individuals may also be examined by forensic accountants.
Family matters may also require the involvement of a forensic accountant. For instance, in the event of a divorce or separation, the accountant is responsible for determining an equitable amount of child support required of either party according to that party’s needs. The division of shared funds is also handled by the accountant. Forensic accounting may also be used in situations where one parent needs to be investigated regarding his or her suitability and capability for being a parent.
Whatever the offense is, whether it’s a personal matter or a large-scale fraud scandal, forensic accounting may pay a part in its resolution. Businesses often rely on forensic accountants for a number of matters. Any litigation involving company acquisitions must be closely monitored by forensic accounting professionals. The same follows for any cases that involve warranties, company evaluations, contract disputes, and professional negligence.