Forensic Accounting

The growing number of cyber crimes, failure of regulators to track the security scams, successive busting of co-operative banks etc. lead to a rise in the need of Forensic accounting. Forensic accounting is the practice of utilizing accounting, auditing and investigative skills to assist in legal matters. Forensic accounting involves legal investigation and analysis of financial documents of any firm or client, who is involved in a legal dispute. It encompasses 3 main areas – litigation (law suit) support, investigation and dispute resolution. Litigation support represents the factual presentation of economic issues related to existing or pending litigation. In this capacity, the forensic accounting professional quantifies damages sustained by parties involved in legal disputes and can assist in resolving disputes, even before they reach the courtroom. If a dispute reaches the courtroom, the forensic accountant may testify as an expert witness. Investigation is the act of determining whether criminal matters such as employee theft, securities fraud (including falsification of financial statements), identity theft, and insurance fraud have occurred. Forensic accountant may recommend actions that can be taken to minimize future risk of loss. Investigation may also occur in civil matters. For example, the forensic accountant may search for hidden assets in divorce cases. This is a field wherein a professional estimates the damages and assists in settling various financial disputes before the cases step into the courtroom. People who are professionals in this field are known as 'forensic accountants' or 'investigative accountants'. Forensic Accountant is a person who is one part accountant, one part detective and one part legal expert. Forensic accountants combine their knowledge of accounting and finance with law and investigative techniques to determine whether an activity is illegal. Many forensic accountants work closely with law enforcement personnel and lawyers during investigations and often appear as expert witnesses during trials. A forensic accountant is an experienced auditor, who acts as a watch-dog of accounts of a company, in order to keep a check on the frauds. These experts are responsible for using technology and implementing investigative techniques to disclose fraudulence and illegal practices in the fields of accounting, banking, financial laundering, etc. They carry out elaborated audits, verify records, gather proof of financial malpractice, and question people related to the misconduct. The base layer of forensic accounting is Accounting knowledge. Other layer of it is a dispersed knowledge of auditing, internal controls, risk assessment and fraud detection. It’s more than simple accounting, and more than basic detective work. Because of its unique elements, it is a combination that will be in demand for as long as human nature exists. Those in a forensic accounting career combine their accounting, auditing and investigative skills to analyze and interpret business and financial evidence, and can participate in trials as expert witnesses. Working on anything from bankruptcy and divorce cases to major fraud and capital crime cases it is the forensic accountant who is involved in all the squad. Eligibility Educational: Most forensic accountants have a bachelor’s degree in accounting, and many have additional academic preparation in fields like criminal justice or law enforcement. After bachelors degree in accounting one can go for diploma or certificate course in Forensic accounting. As part of Law in some institutes forensic accounting is also taught as a separate paper. To work as a forensic accountant abroad, you'll need to earn a bachelors degree in accounting and CPA certification to begin a forensic accounting career. It is also advantageous to become a CFE (Certified Fraud Examiner) or a CrFA (Certified Forensic Accountant). Course in forensic accounting covers areas like Financial Accounting and Financial Frauds, Criminology & Ethics, Forensic Accounting and Fraud Investigation, Legal Framework for Forensic Accounting etc. Personnel Attributes: The job of a forensic accountant is quiet challenging. It requires commitment, loyalty, and devotion. Understanding of psychological theories, analytical/investigative skills is a must for the person. Forensic accounting requires the most important quality a person has to possess: the ability to think. His/her conclusion should not be based on any assumption or opinion. Proper research work and detailed study of accounts is required to draw a fair and unbiased conclusion. Forensic accountants need to possess sound knowledge in financial procedures and have investigative skills. They must have the skills of both a private investigator and an accountant. Hence he/she requires an exquisite eye for detail, a solid background in both accounting basics and legal concepts, and a love of the excitement that comes with law as well as order. Forensic accountants must have remarkable curiosity, attention to detail, persistence, and the ability to think creatively and communicate effectively. Many accountants may have to work with a team who have different backgrounds, so they must be able to communicate clearly and concisely