What Is Forensic Accounting?
Part private investigator and part accountant, a forensic accountant is a person who integrates accounting, auditing and investigative skills in order to provide accounting analysis that is suitable for admission in a court of law. This analysis can form the basis for discussion, debate and dispute resolution and encompasses two areas – litigation support and investigative accounting (Bresler 2012). Litigation support is the factual presentation of economic issues related to existing or pending litigation. A forensic accountant quantified damages sustained by parties in legal disputes and can work toward resolving those disputes before they reach the courtroom. Should the dispute reach a trial, the forensic accountant can be called on to testify as an expert witness. The investigative side determines whether a criminal act as occurred. Some of the criminal matters investigated can includes employee theft, securities fraud, identity theft and insurance fraud. A forensic accountant may recommend actions in order to minimize future risk of loss for companies (Bresler 2012). In the current business marketplace, both publically and privately held companies will hire a forensic accounting to take a look at the books and ensure that financial statements are an accurate representation of the state of the company (Bresler 2012). Historically, forensic accountants who work in public practice were often called after owners suspected that fraud has been committed. Now, recent major corporate scandals have prompted business owners to turn to Forensic Accountants for proactive fraud checkups. Divorce attorneys may call on forensic accountants to determine whether assets are being understated or liabilities are overstated. Forensic accountants may be asked to determine the amount of the loss sustained by victims, testify in court as an expert witness and assist in the preparation of visual aids and written summaries for use in court...
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